Chinese e-commerce giant Alibaba begins restructuring with a plan to float its logistics subsidiary in Hong Kong.

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Sayed Farooq
Sayed Farooq
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April 23, 2023



Reuters, September 26 – Tuesday marked the beginning of Alibaba Group’s restructuring with the announcement that it intended to list its logistics division, Cainiao, on the Hong Kong Stock Exchange. This would mark the division’s first separation since the Chinese e-commerce giant announced its break-up six months prior.

Alibaba announced on Tuesday that it has made a request to the Hong Kong Stock Exchange to spin off Cainiao Smart Logistics Network, but that certain financial details, such as the size of the sale, were still being worked out.

After the spin-off, Cainiao will still be a subsidiary of Alibaba, which now owns 69.54% of the company and will continue to own more than 50% of the company’s shares, according to Alibaba.

Cainiao planned to raise between $1 billion and $2 billion, according to a May report from Reuters. Since co-founding Cainiao in 2013 with partners such department store owner Intime Group and several logistics companies, the unit has grown into a significant logistics provider in its own right in China, providing services to both Alibaba and other third parties.

Dealmakers have expressed the optimism that Cainiao’s IPO, which is anticipated to be followed by market debuts from other Alibaba entities soon, could jump-start lethargic fundraising activity in Hong Kong.

Following the news on Tuesday, Alibaba’s U.S.-listed shares erased early premarket trading losses and were down 0.4% at $86.86 by 1037 GMT.

Alibaba unveiled its largest restructuring in its 24-year history at the end of March. It will divide its firm into six parts using a holding company management format, the majority of which will look into capital raises or market debuts to finance growth.

The makeover coincided with Beijing’s efforts to promote growth in the private sector after two years of crackdown and was unveiled the day after Alibaba founder Jack Ma returned home from a year abroad.

Since then, the business has authorised a procedure to begin external financing for its foreign commerce division, and it was also considering listing its cloud business.

But earlier this month, Daniel Zhang abruptly quit his position as the group’s chairman and CEO to focus solely on the cloud business, which had been a blow to the cloud segment.

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