ALIBABA APPROVES SPINOFF OF ITS CLOUD COMPUTING BUSINESS

Company prepares for grocery and logistics units to go public

Alibaba plans to spinoff its cloud computing business and said Thursday that its logistics and grocery units will explore initial public offerings as the Chinese company kickstarts a restructuring of its operations in hopes of spurring growth.

The e-commerce company in March announced plans to reshape itself into six business divias sions with plans to allow all but its core e-commerce business to raise external capital and go public.

In an earnings call Thursday, Alibaba CEO Daniel Zhang said that the Alibaba plans to fully spin off its cloud computing unit and complete a public listing in the next 12 months, allowing it to “optimize operations,” Zhang said.

Alibaba’s board of directors approved the full spinoff of the cloud computing unit via a stock dividend distribution to shareholders, the company said.

Zhang also said that Freshippo, its groceries arm, as well logistics arm Cainiao, are “ready to go public.”

Alibaba’s board has approved plans to begin Freshippo’s IPO process and Cainiao will explore an IPO in the next 12 to 18 months, he said.

Other units such as Alibaba’s international digital commerce group, which operates Singapore-based e-commerce platform Lazada, will also explore raising external capital as it seeks to expand globally.

Alibaba Group Holding on Thursday posted a lower-thanexpected 2 percent rise in revenue for the quarter ended March, suggesting that spending has been slow to bounce back in China since the removal of COVID-19 restrictions amid slowing economic growth.

The company reported revenues of $29.6 billion for its March quarter.

It also reversed losses from the same quarter last year, posting a net income of $3.3 billion due to one-off gains from its equity investments.

Revenue from its China commerce business — Alibaba’s largest business unit by revenue — declined 3 percent compared with the same period last year.

Its cloud computing unit also declined 2 percent in revenue.