Ali Babathe Chinese giant founded by Jack Ma, has announced its intention to divide its operations into six main business units. This strategic move aims to separate the different branches of the company so that operations can be managed better. And provide greater transparency to investors.
Alibaba divided into six business units
Alibaba’s six major business units include e-commerce, media, cloud computing and innovative technologies, logistics and local services, food and consumer services, in addition to Alipay payment platform. Each of these divisions will explore fundraising or initial public offerings at the right time.
The announcement of this strategic move had an immediate effect on the equity markets, with Alibaba stock posting a sharp increase. In the New York Stock Market (NYSE), stocks Alibaba jumped 7%, to surpass $92. While on Wall Street they recorded an increase in‘11%.
Alibaba’s business division could lead to an aincreased competition within the Chinese market, encouraging other companies to follow the company’s lead and separate their businesses in a similar way. According to experts, this could lead to an increase in dynamism and innovation within the Chinese market. Encouraging the expansion of companies and the achievement of new markets.
Alibaba’s decision to separate its operations into six core business units is an important strategic move for the company, which aims to provide greater clarity and transparency to investors. But also to facilitate access to the capital markets and to fully exploit its growth potential. It remains to be seen whether, after the positive effect on the markets, this separation will prove to be the winning one.