Zhang said the cloud spinoff was intended to simplify the structure and respond to market needs. A standalone platform could grow to someday even surpass Alibaba in size if it attracted the right external financing, he said without elaborating. Analysts have in the past argued that private clouds could operate at a disadvantage to state-backed rivals given Beijing’s growing insistence on using government-controlled data storage and internet services.
Alibaba Group Holding Ltd. will explore initial public offerings (IPOs) for its logistics and grocery arms while hiving off its US$12 billion cloud business, kicking off the first phase of a much-anticipated breakup to try and revive anaemic revenue growth.
Chief Executive Officer Daniel Zhang outlined the contours of that historic shakeup for the first time, which starts with the listing of its grocery arm Freshippo as early as six months from now, before proceeding to the float of its giant Cainiao logistics arm over the next year to 18 months. Significantly, Alibaba will completely carve out the nation’s biggest cloud services platform as a dividend to shareholders, meaning it could relinquish control of one of its fastest-growing businesses.
