Alibaba Announced Major Business Restructuring As It Restructures Into 6 New Business Units

(CTN NEWS) – In order to adapt to fast changing technologies, the Chinese e-commerce behemoth Alibaba Group has announced a significant management restructuring and the creation of six new business groups.

When the Chinese economy is stagnant despite the release of COVID-19 pandemic limitations a half-year ago, the measures are also meant to spur growth.

The business announced in a statement on Tuesday that Eddie Wu, chairman of its e-commerce group, will follow Daniel Zhang in the role of CEO.

The division of Alibaba’s cloud computing business that has been given the go-ahead to be spun off and is anticipated to go public for trading within a year will be led by Zhang as CEO and chairman.

Zhang will be succeeded as chairman of the Alibaba Group by Joseph Tsai, who is currently Alibaba’s executive vice chairman.

Tsai, a Canadian citizen born in Taiwan, is the owner of the NBA basketball franchise Brooklyn Nets and the chairman of the Alibaba-owned South China Morning Post, a daily published in Hong Kong.

In the late 1990s, he participated in founding Alibaba.

When the company was established in 1999, Wu served as its technical director.

Between 2014 and 2019, he also worked as Jack Ma’s personal assistant, serving as special assistant to the co-founder of Alibaba and former board chairman.

He has also held positions as chairman of Alibaba Health and CTO of Alipay, Alibaba’s digital wallet company.

With the exception of its core e-commerce operation, five of Alibaba’s six business units will be able to raise outside funds and go public as a result of its reorganisation.

Sept. 10 marks the implementation of the amendments.

Alibaba Group Announced Major Business Restructuring As It Restructures Into 6 New Business Units

In 2015, Zhang was appointed CEO of Alibaba Group. In 2019, he succeeded Ma as chairman. He is credited with inventing the Singles’ Day shopping festival, which has evolved into the biggest online shopping extravaganza in the world.

Given the significance of Alibaba Cloud Intelligence Group as it moves closer to a full spin-off, Zhang stated in a statement, “This is the right time for me to make a transition.”

To guarantee a smooth transition, “I look forward to working closely with Joe and Eddie in the coming months.”

Following the news, Alibaba’s Hong Kong shares fell by around 1.5% on Tuesday afternoon.

The Chinese government has been looking at Alibaba recently as part of a crackdown on the technology sector.

Ma, the most well-known co-founder of the company and once the richest man in China, has maintained a low profile and made few public appearances since he harshly criticised China’s financial and regulatory systems in a speech in Shanghai in October 2020.

A planned initial public offering of Ant Group, Alibaba’s financial unit, was quickly abandoned by the government. It had been planned to raise $34.5 billion, making it the largest share offering ever at the time.

Rapidly Evolving Technologies

Later, as Chinese authorities cracked down on the once-free-wheeling technology sector, Alibaba was fined $2.8 billion for violating antitrust laws.

Ma reportedly travelled to Europe, Japan, Thailand, and Hong Kong during the past few years before returning to mainland China in March.

His travels have been widely scrutinised as a gauge of Beijing’s stance on private enterprises.

According to a university biography page, he is currently a visiting professor at the University of Tokyo until October 31. His research focuses on “sustainable agriculture and food production.”

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