Alibaba’s former CEO Daniel Zhang is stepping down from the cloud unit in a surprise exit amid a leadership transition

former Alibaba Group Holding Chairman and CEO Daniel Chang Yong is stepping down from his position as head of the e-commerce giant’s cloud division, a move that comes as a surprise on the same day he was scheduled to hand over the reins of the parent company to the co-founder. Joseph C. Tsai.

Alibaba’s new CEO Eddie Wu Yongming, who took up his new role like Tsai on Sunday, also took over as chairman and CEO of Alibaba Cloud Intelligence Group on the same day, according to an Alibaba spokesperson.

Alibaba owns the South China Morning Post. Announced in June Zhang, 51, will resign from his position as CEO and chairman of Alibaba, but will remain as head of the cloud unit “given the importance of Alibaba’s Cloud Intelligence Group as it moves toward a full spin-off.” Zhang took over as CEO of Alibaba in 2015 and Chairman of the Board in 2019.

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Alibaba Group shares fell 2.8 percent to HK$88.25 as of 9.45 a.m. local time, the biggest decline since August 18. The stock has gained 1.7 percent this year, and has advanced 3.5 percent since June 20 when the group first announced the leadership transition. .

“Four years ago, when… [Alibaba founder] Jack [Ma] “He passed the torch of the presidency to Daniel, launching our commitment to an institutionalized succession system that supports a sustainable enterprise for centuries,” Tsai, who is also chairman of the newspaper, said in an internal letter to Alibaba employees on Sunday. “Today, Daniel has entrusted that torch to Eddie and me as our system of leadership succession continues.”

He also said that the company has decided to “invest US$1 billion in the technology fund” set up by Zhang. “The fund will support Alibaba’s investment strategy for future growth and further development of our technology ecosystem,” Cai said, adding that the Alibaba partnership will give Zhang the distinguished title of “Honorary Alien,” a first for the company.

Alibaba “will continue to implement its previously announced plan to separate Alibaba Cloud Intelligence Group under a separate management team to be appointed,” the spokesperson said.

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