Former Alibaba CEO Daniel Zhang steps down from cloud unit in surprise exit amid leadership transition
- Zhang’s exit comes the same day he was scheduled to hand over the company to chairman Joe Tsai and CEO Eddie Wu Yongming as decided in June
- Alibaba says cloud spin-off still on the table, group to invest US$1 billion in a technology fund to be set up by Zhang
Alibaba’s new CEO Eddie Wu Yongming, who like Tsai assumed his new role on Sunday, has also taken over for Zhang as acting chairman and CEO of Alibaba Cloud Intelligence Group on the same day, according to an Alibaba spokesperson.
“Four years ago, when [Alibaba founder] Jack [Ma] passed the chairmanship torch to Daniel, he set in motion our commitment to an institutionalised succession system that supports a sustainable enterprise for centuries,” said Tsai, who is also chairman of the South China Morning Post, in an internal letter to Alibaba employees on Sunday. “Today, Daniel has entrusted that torch to Eddie and me under the continuity of our system for leadership succession.”
Alibaba’s shares fell 3 per cent amid a declining market to HK$88.05 at the close of trading in Hong Kong on Monday, the biggest one-day drop since August 18. The stock has retraced 0.7 per cent this year, and 0.3 per cent since June 20 when the group first announced the leadership transition.
“We think this latest change was not planned back in June, and there are concerns about disagreements among Alibaba’s partners,” said Chelsey Tam, a senior equity analyst for Morningstar, adding that it could raise concerns for corporate governance.