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Alibaba Group Holding Ltd. is continuing its attempt to unlock value from its sprawling business with another planned spinoff.
The Chinese e-commerce company announced Tuesday that it intends to spin off its Cainiao logistics unit, with plans to give that company its own listing on the Hong Kong Stock Exchange.
Alibaba
BABA,
expects that the spinoff will allow investors to better value the parts of the company that remain. The company said it anticipates that the spin will also “better reflect the value of Cainiao Group on its own merits and increase its operational and financial transparency.” Alibaba will still hold more than half of the shares in Cainiao and retain the business as a subsidiary even after the proposed spinoff.
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The company has yet to determine the size of the proposed spinoff or how much its stake in the company would decrease upon such a move.
Bloomberg News reported recently that a Cainiao spinoff announcement could come as soon as this week.
The Cainiao announcement follows one from earlier this year in which Alibaba’s management outlined a plan to spin out the company’s cloud-computing business. The moves are part of a broader business shakeup, announced back in March, when Alibaba said it would be reorganized into six units that would have the potential to pursue their own fundraising and initial public offerings.
See more: Alibaba will reorganize into 6 units in the ‘ultimate value unlock’
Alibaba’s U.S.-listed shares were off 0.2% in morning trading Tuesday. The stock is off about 2% so far this year.
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