Chinese tech conglomerate, Alibaba, has announced that it would split into 6 business groups.
Alibaba has operations in cloud computing, e-commerce, media, logistics, and entertainment, as well as artificial intelligence.
The company’s CEO, Daniel Zhang, has said in a statement that the restructuring would allow each individual business to pursue its own fundraising and public listing plans.
According to the company, this move is intended to unlock shareholder value and foster market competitiveness. Under the new arrangement, each of the 6 newly formed units will be managed by their own CEO and board of directors.
However, Taobao Tmall Commerce Group, will remain wholly owned by Alibaba Group.
Zhang will remain as CEO of the group but the day-to-day operations of the individual business units will be ceded to the new management bodies.
According to Alibaba, the new structure will bring greater market visibility to the value of its diverse business operations. These changes however, will not affect the group’s listed in New York and Hong Kong.
Aiming for a more “nimble structure”, the reorganisation will also involve cuts to the firm’s middle and back office functions.
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