BEIJING: Alibaba announced on Tuesday that it would split into six business groups in one of the biggest overhauls of a leading Chinese technology firm.
The Hangzhou-based firm is one of the most prominent tech giants in the country, with business operations spanning e-commerce, logistics, cloud computing, artificial intelligence, media, and entertainment.
The company’s chairman and CEO, Daniel Zhang, said in a statement that the firm’s restructuring would enable each business to pursue its own public listing and fundraising plans.
Alibaba claimed the steps were intended to foster market competitiveness and unlock shareholder value.
Under the new arrangement, each of the six newly established units will be managed by its own Chief Executive Officer and board of directors.
A key exception to the restructuring plan is Taobao Tmall Commerce Group, the operator of one of the country’s top online purchasing platforms, which will remain totally owned by Alibaba Group.
Zhang will remain the firm’s CEO, although individual business units’ day-to-day operations will be taken to the new management bodies.
The firm said the new structure would create greater market visibility for its diverse business operations’ value.
Alibaba shares
The firm said these changes would not affect Alibaba shares presently listed in Hong Kong and New York.
Aiming for a more “nimble structure,” the restructuring will also involve cuts to the company’s middle and back-office functions.
The giant has faced big headwinds in recent years as Beijing has imposed strict restrictions on the domestic technology industry.
Combined revenue at the country’s internet companies shrank by just over 1 percent to $212 billion in 2022, the first fall in almost a decade, according to data released by the Ministry of Industry and Information Technology.
Alibaba’s founder
Jack Ma, the Alibaba founder, has kept a low profile since late 2020, when one of his speeches attacking Chinese regulators was followed by the government pulling the plug on Ant Group’s planned IPO, the Alibaba affiliate.
Having risen into a sprawling corporate behemoth since its establishment in 1999, the firm has sought new ways to drive growth and reinvigorate its development.
