Alibaba Sells Intime Department Store Unit

(Reuters) – Alibaba Group announced on Tuesday that it will sell its Chinese department store unit, Intime, resulting in a $1.3 billion loss. This decision follows the company's strategic shift to focus on its core e-commerce operations.

The sale represents an acceleration in Alibaba's restructuring efforts after the group split into six business units last year and subsequently made several top management changes.

Last month, Alibaba unveiled plans to integrate its domestic Chinese and international e-commerce platforms into a single business unit managed by one leader, responding to increasing competition from discount retailers.

Rival platforms such as PDD Holdings' Pinduoduo and Temu, along with ByteDance's Douyin and TikTok, have been aggressively attracting cost-conscious shoppers with low prices.

Alibaba announced the sale of Intime to a consortium led by Youngor Fashion and members of Intime's management for 7.4 billion yuan ($1.02 billion), pending regulatory approvals. Alibaba acquired Intime in 2017 for $2.6 billion, holding a 99% stake in the business.

The e-commerce giant has been divesting consumer sector assets, including Intime and its grocery business, Freshippo, to concentrate on its core operations, as reported in February.

Under former CEO Daniel Zhang, Alibaba expanded in the retail space by acquiring multiple brick-and-mortar chains, including electronics retailer Suning and hypermarket operator Sun Art Retail, which operates RT-Mart.

However, China's challenging consumer environment has pressured all retailers and e-commerce platforms.

In April, Alibaba co-founder Jack Ma expressed support for the company's restructuring efforts and acknowledged past mistakes in a memo to employees.