They will then be listed individually on the stock exchange. The company, and its founder Jack Ma, have long been targeted by the government. The group aligns with anti-monopoly regulations wanted by Xi. Foreign investors still cautious about the future of their operations in China. They look to alternative markets such as India and Vietnam.
Beijing (AsiaNews) - Alibaba announced yesterday that it will split its business into six units: the new branches will then be listed individually on the stock exchange. Since the end of 2020, the hi-tech giant founded by Jack Ma has been in the authorities' sights, since they launched an anti-monopoly campaign, under Xi Jinping's orders, especially against the technology, real estate and private education sectors.
Alibaba's announcement came a day after Ma reappeared in China. The well-known billionaire has not held any posts in the group for some time. His trail was lost more than two years ago after he criticised the country's financial regulators: words that were followed by tensions between the government and the company.
Xi is in all likelihood worried about losing political control in the face of businessmen amassing enormous wealth. According to several observers, the campaign for 'common prosperity' promoted by the general secretary of the Chinese Communist Party, which requires large corporations to contribute to the welfare of the less wealthy, is actually aimed at depowering oligarchs like Ma.
Markets welcome the unbundling of Alibaba: they see it as a sign that Xi's crackdown on big corporations is coming to an end. Investors assess that the newly unbundled companies will be better able to defend themselves against regulations targeting just one of them.
Analysts note that now Alibaba's competitors (Tencent and JD) may also go the splitting route, with one holding company encompassing several separate companies - the best way to align with the anti-monopoly laws introduced by Xi.
However, the bosses of big foreign companies are cautious about the new Chinese government's promises to foster better conditions for private investment. At the China Development Forum in recent days, CEOs of big foreign companies said they expect concrete actions after words.
Foreign investors, especially from the US and Europe, have long been asking Beijing for more access to the local market. In addition to over-regulation, aspects such as China's declining exports, the real estate crisis, the growing debt of territorial governments, and the technology war with the US are included in their assessments for future transactions.
It is no coincidence that Apple recently announced plans to open new plants in India and Vietnam: a way to reduce dependence on investment in China.