Alibaba will split into six different companies

Some fresh pieces of information indicate that Alibaba is going to split into different organizations. as per information from Reuters, Alibaba will restructure into six different companies. With this split, every company will be able to pursue fundraisings and market listings given the ease in China’s government policies for private enterprises.

Alibaba is restructuring into six companies

The company will restructure into the following companies:

• Cloud Intelligence Group (cloud solutions)
• Local Services Group (delivery services)
• Global Digital Commerce Group (AliExpress)
• Cainiao Smart Logistics Group (logistics)
• Taobao Tmall Commerce Group (local online commerce services)
• Digital Media and Entertainment Group (gaming, motion pictures, and web services)

The news comes a day after Jack Ma returned to China, which is viewed as a sign that Beijing is taking a more relaxed stance towards private companies. During the past two years, Alibaba has been the subject of intense scrutiny after becoming a target of regulators.

Chief Executive Daniel Zhang has informed the staff that the main intention is to offer quick response and agility to the firm. He will continue to serve as chairman and CEO of Alibaba Group, which will adopt a new management structure known as a holding company.

Every new business will have a separate CEO and a board of directors. Each of the six businesses will have the capacity to raise capital outside of the umbrella company. There is just one exception to this i.e., Taobao Tmall Commerce Group. Since it will be completely owned by Alibaba Group.

Experts believe that the restructuring is an effort to soften the company’s stance towards US authorities and foreign investors. Recently, Li Qiang was appointed as China’s premier. From this perspective, Jack Ma’s return to the country may help local business owners feel more confident that China’s tech crackdown is coming to an end.