(CTN News) – The Chinese e-commerce giant, Alibaba Group, announced in a regulatory filing on Tuesday that it plans to list its logistics unit Cainiao on the Hong Kong Stock Exchange.
Alibaba will continue to hold more than 50% of the shares of Cainiao.
The move is part of what has been described as one of the most radical shake-ups in history. According to reports, the company announced in March that it would split its structure into six business units, most of which will be able to raise outside capital and go public in the near future.
As the first of these businesses to file an initial public offering (IPO), Cainiao is the first of these businesses to do so. It is clear from Alibaba’s statement that there is no assurance that the proposed spinoff will take place.
According to Alibaba, the Hong Kong Stock Exchange has confirmed that the Cainiao listing may go ahead. In regards to individual listings, the exchange declined to comment on them.
The pricing of shares as well as the expected listing date have not yet been disclosed as details have yet to materialize.
A logistics network named Cainiao was founded in 2013 with the goal of helping fulfil deliveries through its e-commerce platforms, both within China as well as overseas. Alibaba strives to fulfill consumer orders as quickly as possible within 24 hours in China and within 72 hours anywhere else in the world.
As of Tuesday, the company holds a nearly 70% interest in Cainiao, after taking a majority stake in the company in 2017.
A major point of competition among Chinese e-commerce firms is the speed of delivery. Among Chinese consumers, JD.com has emphasized same-day delivery as a means of increasing the appeal of its platform.
In a statement, Alibaba stated the IPO will enhance Cainiao’s “standalone profile among its customers, suppliers, and potential strategic partners, which will help it to negotiate and solicit more business.”
Alibaba further stated that the listing will” address a more direct alignment of the responsibilities and accountability of the management” of both Alibaba and Cainiao.
A major leadership reshuffle at was announced in June, when former CEO Daniel Zhang stepped down and was replaced by Eddie Wu.
After retaining leadership of the cloud computing unit, Zhang announced his intention to exit the company this month.
The head of Alibaba’s cloud division has been appointed Wu.
Alibaba is also exploring the possibility of listing its cloud computing business, though it has not yet filed for a spin-off.