Cainiao ushered in new progress in listing.
On September 26, Alibaba (9988.HK) announced on the Hong Kong Stock Exchange that the company intends to spin off Cainiao through a separate listing of Cainiao shares on the Main Board of the Hong Kong Stock Exchange (HKEX). The Company has submitted a demerger plan to the HKEX and the HKEX has confirmed that the Company can proceed with the proposed demerger and the demerger listing application has been filed with the HKEX.
The announcement pointed out that the proposed demerger would be conducted by way of a global offering of Cainiao Shares (including a Hong Kong public offering and an international offering). Upon completion of the proposed spin-off, Alibaba will continue to hold more than 50% of Cainiao's shares and, as such, Cainiao will remain a subsidiary of the Company. Details of the proposed spin-off, including the size and structure of the global offering and the reduction of the Company's percentage stake in Cainiao, have not yet been finalized. The Company will make a further announcement on the proposed demerger in due course.
According to the announcement, Alibaba Group's business includes six business groups: Taotian Group, Ali International Digital Business Group, Cloud Intelligence Group, local life Group, Cainiao Group and Entertainment Group, as well as various other businesses. Cainiao was founded on May 20, 2015, and Ali holds about 69.54% of the shares of Cainiao. Cainiao is a global leader in the e-commerce logistics industry, providing innovative logistics services and solutions to Chinese and global merchants and brands, e-commerce platforms, consumers and logistics companies. Cainiao's main businesses include international logistics, domestic logistics and technology and other services.
The announcement also said that after the completion of the proposed spin-off, Alibaba's unspinoff Group will continue to operate its existing major businesses, which include Taotian Group, Ali International Digital Business Group, Cloud Intelligence Group, Local Life Group, Entertainment Group and other businesses, with the exception of those operated by Cainiao Group.
As for the reasons and benefits of the spin-off, Alibaba said that the spin-off will allow investors to better assess the value of Alibaba and focus on the businesses of the non-spin-off group. The spin-off will better reflect Cainiao Group's own value and enhance its operational and financial transparency, which will enable investors to evaluate and evaluate the performance and potential of Cainiao Group and the non-spin-off Alibaba Group separately; Cainiao's business differs from the relatively more diversified model of Alibaba's unspun group, and will attract a group of investors who focus exclusively on Cainiao's business.
In addition, the announcement also pointed out that the separation is expected to increase the value of Cainiao Group, which will benefit Alibaba and its shareholders as a whole. These include helping Cainiao negotiate better and attract more business; To enable Cainiao to have direct and independent access to equity and debt capital markets as and when needed in the future, and to further enhance its ability to obtain bank credit financing to more effectively deploy the financial resources of Alibaba's unspinoff Group; To provide a clear picture of Cainiao Group's credit standing for rating agencies and financial institutions that wish to conduct credit analysis on the status of logistics services business and provide loans accordingly; And more directly align the responsibilities and accountability of the management of the Company and Cainiao with their respective operating and financial performance.
At the end of March this year, Alibaba announced the construction of a "1+6+N" organizational structure, of which Cainiao is one of the six business groups. On the evening of May 18, Alibaba announced that Cainiao will launch an exploratory listing, which is expected to be completed in the next 12-18 months. That night, Cainiao Group CEO Wan Lin issued a letter to all employees saying that he hoped all Cainiao employees would speed up capacity building, start a new entrepreneurial journey, and strive to become the world's leading comprehensive digital intelligence logistics group and a respected good company in the next decade.
In terms of financial data, on the evening of August 10, Alibaba Group released its financial report for the first quarter of the fiscal year 2024. Among them, Cainiao Group achieved revenue of 23.164 billion yuan, an increase of 34%. It was mainly driven by increased revenue from international logistics compliance solution services and domestic consumer logistics services. Revenue growth was driven by external customers as well as Alibaba's consolidated business. Adjusted EBITA for the quarter was a profit of $877 million, a year-over-year turnaround. It lost 185 million yuan in the same period last year. The positive year-over-year profitability was mainly due to improved operating results from international logistics compliance solutions and domestic consumer logistics services.