Alibaba to be divided into 6 independent business groups each of which to go to stock market

Alibaba will be divided into six separate and independent business groups, each of which will become a public company and go to the stock market to draw external funding.

As CNBC notes, this will be the largest restructuring in the history of this Chinese e-commerce giant.

Alibaba said in a statement that the main objective of this restructuring was to "unlock shareholder value and foster market competitiveness." The management of Alibaba decided to take this step after two difficult years for the company. Economic growth in China has slowed, and Beijing has tightened government regulations, leading to heavy financial losses and lower stock prices.

Each business group will have a separate CEO and board of directors:

• Cloud Intelligence Group will specialize in cloud technology and artificial intelligence. This company will be headed by Alibaba CEO Daniel Zhang.
• Taobao Tmall Commerce Group will cover the company's online shopping platforms, including Taobao and Tmall.
• Local Services Group includes food delivery service Ele.me and mapping. It will be headed by Yu Yongfu.
• Cainiao Smart Logistics incorporates Alibaba's logistics service. The head of this domain will remain Wan Lin.
• Global Digital Commerce Group comprises Alibaba's international e-commerce businesses, including AliExpress and Lazada. The head of this department will be Jiang Fan.
• Digital Media and Entertainment Group includes Alibaba's streaming service and movie business. The head of this department will be Fan Luyuan.

Of these businesses, only Taobao Tmall Commerce Group is wholly owned by Alibaba. The rest will go to the stock market and raise funds as soon as they are ready.

When it became known about the restructuring of Alibaba, the company's shares in the US rose by more than 14 percent.