HomeeCommerce NewsAlibaba shares up over 15% in Hong Kong over split announcement

Alibaba shares up over 15% in Hong Kong over split announcement

You must be aware that there are a lot of issues with the Alibaba and ANT Group in China because of the regulatory issues and this is because of Jack Ma’s public outcry for the Chinese Government that led to them taking action on his companies. Soon after that, Alibaba Group announced that its CEO and co-founder Jack Ma will be leaving his role as the CEO and a new CEO was announced as Daniel Zhang. Currently, Daniel is the Chairman of the Alibaba Group and also serves as the CEO. It looks like he has taken a big discussion, obviously along with Jack Ma, and others to split Alibaba into six different companies.

The market also had a feeling that Alibaba has become too big a company for its own good and that is the reason why it is feeling the pinch and investors also doubt that they will get better returns on their investment. Due to that reason, Alibaba has decided to split its offerings into six different companies and all the companies will have their own board and chairman along with an option to launch IPO later on as well. This means that investors can invest into any of the smaller companies from the Alibaba Group and get better returns.

Alibaba, in its statement, said that the decision to split into six smaller companies was mainly to “unlock shareholder value” but the fact that Alibaba Group was under investigation by the Chinese authorities must have also contributed to this decision. Interestingly, this announcement comes immediately after the former CEO of Alibaba Group Jack Ma was seen in China after a gap of one year.

It is also worth noting that Alibaba has been listed in Hong Kong and its shares rose by as much as 15% soon after the announcement which tells us that the investors loved this announcement from the company. Alibaba’s six business groups are:

  • Cloud Intelligence Group: includes company’s cloud and artificial intelligence activities;
  • Taobao Tmall Commerce Group: online shopping platforms including Taobao and Tmall;
  • Local Services Group: covers Alibaba’s food delivery service Ele.me as well as its mapping;
  • Cainiao Smart Logistics: houses Alibaba’s logistics service;
  • Global Digital Commerce Group: includes Alibaba’s international e-commerce businesses including AliExpress and Lazada;
  • Digital Media and Entertainment Group: includes Alibaba’s streaming and movie business.
Alf Alferez
Alf Alferez
Dedicated writer with a strong track record of developing customer loyalty and managing general office operations. Enjoy being a part of a company where my skills and creative ideas will benefit the overall productivity of the organization. I have a strong desire to work in helping make the world a better place. Please reach out to me on alf@ecommercenext.org

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