2023-03-28 11:01:11 ET
Alibaba ( NYSE: BABA ) shares rose as much as 10% Tuesday as investors showed their enthusiasm for the Chinese e-commerce giant after it said it would split into six different units with a goal of boosting each group's individual business value.
Prior to the start of trading, Alibaba ( BABA ) made it plans public in a Securities and Exchange Commission filing . The company said the six groups would be Cloud Intelligence, Taobao Tmall Business, Local Services, Global Digital Business, Cainiao Smart Logistics and Digital Media and Entertainment.
"Under this plan, will have six major business groups and other investments, each to be independently managed by its own chief executive officer and board of directors," Alibaba said in its regulatory filing.
The company added that, aside from Taobao Tmall Business, which will remain fully owned by Alibaba ( BABA ), each of the other business groups "will also have the flexibility to raise outside capital and potentially to seek its own IPO."
Alibaba's ( BABA ) announcement came a day after the company's legendary founder, Jack Ma, made his first appearance in mainland China after several months overseas. Ma has largely avoided visiting his home country for more than two years since he gave a speech in late 2020 in which he criticized Beijing's financial and business regulators.
With Alibaba ( BABA ) leading the way, other Chinese tech stocks rose in tandem with their national brethren. Tencent Holdings ( OTCPK:TCEHY ) stock rose 6%, NetEase ( NTES ) was up by 2%, Weibo ( WB ) shares climbed almost 5%, BiliBili ( BILI ) edged up by 2% and JD.com ( JD ) rose 3%.
The KraneShares CSI China ETF ( KWEB ) was also up by more than 3%.
Meanwhile, Baidu ( BIDU ) stock rose almost 4% one day after the Chinese Internet search leader cancelled an event where it was to show off its new AI technology, called Ernie Bot .
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Alibaba stock rockets 10%, Wall Street cheers company's split up plan