What: Alibaba’s empire is being split into new entities.

Why it is important: While this might signal some political will from Chinese government, this might also mark the beginning of a more aggressive international strategy for Tmall, as it will be not restrained anymore and limited to the national operations of the mother group.

Alibaba, one of China's largest private-sector companies, plans to split itself into six different companies that could seek separate IPOs, effectively dismantling the business empire that charismatic entrepreneur Jack Ma built over two decades. Alibaba was once valued at over $800 billion, but it is now worth about a quarter of that. The restructuring comes after Chinese authorities signalled that they were winding down a sweeping regulatory clampdown aimed at reining in the country's powerful tech sector.

Under the restructuring, Alibaba's various businesses will be split into six major areas, including cloud computing (Cloud Intelligence Group), Chinese e-commerce (Taobao Tmall commerce group), global e-commerce (Global Digital Commerce Group), digital mapping and food delivery (Local Services Group), logistics (Cainiao Smart Logistics Group), and media and entertainment (Entertainment Group). Each business group would have its own CEO reporting to a board of directors and be fully responsible for the group's performance. Alibaba Group will become a holding company overseen by Daniel Zhang, the Chairman and Chief Executive.

Those business groups will be allowed to raise external capital and seek initial public offerings when they are ready, Alibaba said. However, its domestic commerce business will remain a wholly owned unit of Alibaba. The power of tech titans like Jack Ma and their influence over society caused unease in Beijing. Companies like Alibaba have a grip on data of more than a billion users and investments across a range of companies in China.

Alibaba to be split into 6 different groups