Revolution Alibaba, the giant will split into six autonomous units

Alibaba, one of China’s most important technology companies, with activities ranging from cloud computing to e-commerce, from logistics to media and entertainment to artificial intelligence, has announced a maxi-restructuring, the most significant ever made since 1999, the year the giant was founded by Jack Ma. The assets, worth a total of 220 billion dollars, will be divided into six main business units, each of which will evaluate the possibility of external fundraising or initial public offerings « at the most opportune moment”.

It is essentially a decision taken “to unlock shareholder value and promote market competitiveness”, commented the Hangzhou-based company in a note, flying among other things at the opening of the Hong Kong Stock Exchange: after 14 .26% gained at the Nyse, the shares of the e-commerce giant also replicated the performance on the former British colony’s stock market, posting a leap of 13.53% in the initial stages, to 95.65 Hk dollars.

Alibaba has faced rather complex growth challenges, considering Beijing’s regulatory tightening on the hi-tech sector and the slowdown in China, but industry experts believe that the group’s growth could resume in 2023, albeit in a difficult scenario . In fact, around $600 billion of the company’s stock market value was wiped out by the October 2020 share price peak and the communist leadership, as mentioned, has launched a crackdown on private technology companies over the years. The giant, among other things, had been fined 2.6 billion in 2021 as part of an antitrust investigation.

With the new reorganisation, new corporate groups will therefore revolve around the strategic priorities of the group. It will start from the Cloud Intelligence Group, from the cloud to artificial intelligence headed by the CEO of Alibaba, Daniel Zhang, passing through the Taobao Tmall Commerce Group, the company’s online shopping platforms, including Taobao and Tmall, the only ones to remain in total control of Alibaba and for the Local Services Group, the food delivery Ele.me. Here, again, the Cainiao Smart Logistics (logistics), the Global Digital Commerce Group (international e-commerce activities, including AliExpress and Lazada) and the Digital Media and Entertainment Group (streaming and films). “This transformation will allow all of our companies to become more agile, improve decision-making and enable faster responses to market changes,” explained Zhang himself.