Alibaba Logistics Arm Set for Hong Kong IPO
Cainiao Network Technology Co., Alibaba Group Holding Ltd.'s logistics division, has begun working with banks in preparation for its Hong Kong initial public offering (IPO). This move sets the stage for Cainiao to become the first of Alibaba's six business units to go public.
Banks Partner with Cainiao for Upcoming IPO
China International Capital Corp. and Citigroup Inc. are collaborating with Cainiao to facilitate the first-time share sale. According to sources who wish to remain anonymous, the company is aiming for a listing as early as the end of this year. Cainiao is currently valued at over $20 billion.
IPO Size and Timeline Remain Undetermined
While Cainiao has not finalized the IPO size, its timeline may change based on market conditions. A company representative stated that there is yet to be a clear plan or timeline for the IPO. Citigroup representatives declined to comment, and CICC representatives did not immediately respond to requests for comment.
Alibaba Announces Plans to Split into Six Main Units
Alibaba recently revealed its intention to divide its $250 billion business into six primary units: e-commerce, media, and cloud. Each unit will explore fundraising or IPO opportunities when appropriate. Alibaba CEO Daniel Zhang mentioned the possibility of gradually relinquishing control over some of the company's main businesses but did not provide specific timelines for IPOs.
Cainiao's 24-Hour Delivery Promise and Global Reach
Cainiao, meaning "rookie" or "amateur" in Chinese, pledges to deliver packages within 24 hours in China and 72 hours globally. As of March 2022, the company operates nine overseas sorting centers and collaborates with over 500 logistics firms worldwide.
LATEST: Alibaba's logistics arm, valued at $20 billion, is reportedly preparing for a Hong Kong initial public offering.
— Paryte (@Parytecom) March 30, 2023
Strong Revenue Growth for Alibaba's Logistics Arm
Cainiao's revenue, after inter-segment elimination, increased by 27% year-on-year to 16.6 billion yuan ($2.4 billion) for the quarter ending December 31, as reported last month. This growth can be attributed to consumer logistics and international fulfillment solutions improvements.
