Chinese e-commerce giant Alibaba on Tuesday announced a restructuring that will split the group into six separately listed entities, a major change for the company.
“The market is the best test, and each entity will be able to proceed with independent fundraising and an IPO when it is ready to do so,” group boss Daniel Zhang said in a letter to his employees. .
This restructuring will “create value for shareholders and stimulate market competitiveness”, assured in a press release the company based in Hangzhou (east), specifying that it is about “the most important reorganization in terms of governance in 24 years” of the group’s existence.
The six new entities will each have a CEO and a board of directors.
A special case for Taobao, the very popular online sales platform in China, which will continue to be 100% owned by the Alibaba group.
Like other Chinese internet giants, Alibaba has been penalized in recent years by the Chinese government’s takeover of the tech sector. The authorities had notably derailed in 2020 a gigantic IPO for its subsidiary Ant Group.
Beijing seems to have loosened up since then and in early January the Chinese authorities finally gave the green light to Alibaba’s payment subsidiary for a fundraising of more than one billion euros in Hong Kong.
According to data from the Chinese Ministry of Industry and Information Technology, the total revenue of Chinese internet companies in 2022 fell by just over 1%, to 1.46 trillion yuan (196 billion euros), the first contraction in nearly a decade.
On February 23, Alibaba had posted “strong growth” in profitability “over the last quarter”.
In November the group announced 2.7 billion euros in losses for the quarter ended in September 2022.
Alibaba posted revenue of 34 billion euros in the quarter ended December, up 2% year-on-year.
Alibaba founder, Chinese billionaire Jack Ma, made a rare public appearance in China on Monday. He left the management of his group in 2019 to devote himself entirely to philanthropic activities.