Alibaba Calls Off IPO for Logistics Arm Cainiao
1 Video View·Mar 27, 2024
Alibaba Group Holding Ltd. scrapped an initial public offering in Hong Kong for its Cainiao logistics arm, the second time Alibaba has nixed a high-profile debut for one of its main businesses. Catherine Lim of Bloomberg Intelligence has more.
We know that Alibaba has these huge spinoff plans, these listing plans, but still it doesn't seem to
really be playing out perhaps as it had been forecast to do so. So was this withdrawal of
the IPO a surprise at all? Right, you know what, not a surprise at all because back in February,
the company was already highlighting that the market conditions were not favourable
for the actual realisation of the values for the number of the assets that's been slated for
spinoffs for the capital markets. And to be honest, since last month, we've not seen a significant
uptick in the market conditions. And clearly, I think the stock exchange has a deadline for
in terms of an updated pre-listing document. And everything in itself, to me, it's not a surprise
at all. Not a surprise, and in a lot of ways, it makes sense strategically, right? What are
you expecting from Alibaba Cai Niao after this? Right, absolutely. Now, look at the way they are
now actually buying out the rest of the 36% of the minority stakes in Cai Niao. That actually
highlights the company's commitment towards growing the logistic business, which is a very integral
part of the company's goal to actually get back market share, not just in China, but globally as
well. So we've heard the company talk about Aliexpress, Aliexpress Choice, which is making
ways in markets like Europe, as well as the Middle East, etc. So going forward, I do expect
that Alibaba may hasten the overall logistics expansion. And they have clearly highlighted
at last night's call that they are committed and going to be very supportive of Cai Niao's
expansion going forward.