Alibaba to split into six business groups

One of the biggest restructurings of a large Chinese internet company to date saw Alibaba declare on Tuesday that it will be divided into six business areas.

The restructuring, according to Daniel Zhang, the company’s chairman and CEO, will let each individual firm pursue its own plans for public IPOs and fundraising
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Hangzhou-based Alibaba said the moves were intended to “unlock shareholder value and foster market competitiveness”.

According to the new system, each of the six recently created units will be run by a separate CEO and board of directors.

One of China’s largest online marketplaces, Taobao Tmall Commerce Group, which is run by Alibaba Group and will continue to be a wholly owned subsidiary, is a significant exception to the restructuring.

The internet titan has recently faced unheard-of challenges as a result of Beijing’s stricter regulations on the local digital sector.

According to information from the Ministry of Industry and Information Technology, combined revenue at China’s internet enterprises fell by little more than one percent to 1.46 trillion yuan ($212 billion) in 2022, the first decline in nearly a decade.

Since China cancelled the planned IPO of an Ant Group affiliate of Alibaba in late 2020, Jack Ma, the founder of Alibaba, has maintained a low profile. Beijing did this in response to a speech he gave in which he criticized Chinese regulators.

Ma has been observed all over the world over the past two years, but on Monday, following his fall from fame, he made a rare public appearance in China.