Alibaba Group┬аis looking to split into six units and explore fundraisings or listings for most of them, the e-commerce┬аgiant said on Tuesday.
The revamp of the conglomerate was announced a day after its co-founder Jack Ma returned home after a year-long stay abroad and as China vows to ease a sweeping regulatory crackdown and support its private firms.
The biggest restructuring in the Chinese conglomerateтАЩs 24-year history would see it split into six units including Cloud Intelligence Group, Local Services Group, Taobao Tmall Commerce Group, Global Digital Commerce Group, Digital Media and Entertainment Group and Cainiao Smart Logistics Group, Reuters reported.
Shares of the US-listed firm jumped about 8 per cent following the news development. Alibaba shares, however, are down 72 per cent since October 2020.
“The original intention and fundamental purpose of this reform is to make our organisation more agile, shorten decision making links and respond faster,” Zhang said in a letter to staff seen by Reuters.
Each business group, he said, had to actively tackle the rapid changes in the market and each Alibaba employee had to “return to the mindset of an entrepreneur.”
Daniel Zhang will continue to serve as chairman and CEO of Alibaba Group, which will follow a holding company management model, and concurrently serve as CEO of Cloud Intelligence Group, Reuters reported.
The report suggested that each of the six business groups will be managed by its own CEO and board of directors and will retain the flexibility of seeking outside capital and seeking an initial public offering, it said.
The exception would be Taobao Tmall Commerce Group that handles its China commerce businesses and will remain an Alibaba Group wholly owned unit.
Zhang also said that the company would тАЬlighten and thin” its middle and back office functions, but did not detail job cuts, the Reuters report suggested.
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