Alibaba sells about $500 mln in ZTO Express shares, cuts stake to 6.1%

Alibaba Group has once again reduced its holdings in a Chinese express delivery company — this time, ZTO Express.

According to the latest announcement from ZTO Express, Alibaba Group and its subsidiaries sold approximately 25 million American Depositary Shares (ADS) of ZTO on the New York Stock Exchange on September 21, priced at $20.02 per ADS — a 4.5% discount to the market price. The ADSs correspond to Class A ordinary shares of the company.

Through this transaction, Alibaba is expected to cash out approximately $500 million (about RMB 3.354 billion). Upon completion, Alibaba's stake in ZTO Express will further decline to 6.1%.

This move marks not only a new round of reduction in Alibaba's long-term strategic holdings in ZTO, but also the latest step under CEO Eddie Wu's leadership to systematically unwind the "Tongda" logistics alliance and reallocate capital resources toward AI.

A Year in the Making: The Unwinding of a Strategic Investment

Alibaba's capital ties with ZTO date back to the e-commerce era.

In the past, Alibaba built a logistics alliance by taking stakes in the "Tongda" express delivery companies — a group including ZTO, YTO, STO, Yunda, and Best — leveraging their delivery capabilities to support its e-commerce expansion.

ZTO was one of them.

In 2018, Alibaba, together with Cainiao, invested $1.38 billion in ZTO, acquiring an initial stake of approximately 10%. The deal included an investor rights agreement and the appointment of a director to participate in governance, with the goal of enhancing logistics digitalization, online capabilities, and intelligence.

The core objective of this investment was clear: to lock in a leading express delivery company, strengthen Cainiao's delivery infrastructure, and ensure stable logistics performance during peak shopping seasons. It was a classic example of ecosystem-driven strategic investment.

The two parties planned comprehensive cooperation across new retail logistics, last-mile delivery, warehousing, and cross-border services — a relationship built on stable holdings and business synergy.

However, this harmonious partnership did not survive the "seven-year itch."

In May 2025, market sources reported that Alibaba was in talks with investment banks about converting its minority stake in ZTO into convertible bonds — a form of indirect stake reduction.

Although those discussions were still at the exploratory stage, the market sensed a shift: Alibaba's attitude toward ZTO had quietly changed.

By 2026, substantive unwinding began to take shape.

On May 20, 2026, ZTO announced the termination of the investor rights agreement signed with Alibaba in 2018. Alibaba executive Xu Di also resigned as a non-executive director — a key preparatory step.

Then came the current move: Alibaba's holding platform executed a single block trade, selling 25 million ZTO ADS at a 4.5% discount, cashing out approximately $500 million.

From the termination of the rights agreement to the executive's departure and the block sale, all signs point to a year-long planned strategy — not an impulsive decision.

Over RMB 20 Billion Divested in Two Years: Capital Flows to New Infrastructure

Looking at the broader timeline, Alibaba's reduction in ZTO is the latest chapter in the group's ongoing effort to shed non-core assets.

Since late 2024, Alibaba has been steadily shrinking its equity investments in non-core areas:

• December 2024: Sold its stake in Intime Retail for RMB 7.4 billion
• January 2025: Sold its entire stake in Sun Art Retail for approximately RMB 12.3 billion
• Subsequent disposals: Reduced holdings in CICC H-shares, Wanda Film, Red Star Macalline, Sanjiang Shopping Club, and other listed companies
• Current transaction: $500 million from ZTO

According to market estimates, Alibaba's total asset disposals over the past two years have exceeded RMB 20 billion.

The ZTO reduction is a key part of Alibaba's phased unwinding of its "Tongda" express delivery investments.

Previously, Alibaba's logistics portfolio covered multiple major express delivery companies. Over more than a decade, through capital investments, Alibaba partnered with YTO, ZTO, STO, Yunda, and Best to form a vast e-commerce ecosystem alliance.

The industry consensus at the time was: whoever controls logistics capabilities controls delivery execution. Alibaba needed a stable delivery network to underpin its e-commerce ecosystem.

This strategy was essentially a positioning play for the e-commerce era.

The exit process began to accelerate after the "1+6+N" organizational restructuring in 2023. Eddie Wu established two strategic priorities — "User First" and "AI-Driven" — and began reorganizing business lines, reshaping strategic priorities, and consolidating command and investment intensity.

As Cainiao was reclassified under the "Other Businesses" segment, Alibaba's pace of reducing holdings in the "Tongda" companies accelerated overall.

• Best Express: Alibaba once held over 30%; it was the first to be fully divested
• Yunda: Alibaba's stake fell from 2% at end-2023 to 1.44% at end-2024, and further to 0.71% by the first half of 2025 — dropping out of the top ten shareholders
• YTO Express: The most typical example of asset contraction. Alibaba's platform, Hangzhou Haoyue, executed three independent block trades, reducing its stake by 6% of total share capital, cashing out approximately RMB 3.049 billion. After the reductions, its stake fell from 11% to 5.06%

Meanwhile, Cainiao's domestic supply chain business was transferred to the Taobao and Tmall Group and integrated into the China e-commerce business unit. STO Express, the most deeply tied to Alibaba, remains 25%-owned by Cainiao Supply Chain, with a retained option to increase its stake.

In July 2026, STO announced plans to acquire Cainiao's premium express delivery brand Daniao Logistics for RMB 362 million, targeting the high-end express market.

These moves all point to a strategic shift in Alibaba's logistics approach: logistics capabilities no longer need to be secured through equity holdings. Platforms and express delivery companies are returning to market-based contractual relationships.

The capital recovered from these disposals will flow to the group's priority sectors.

AI and Cloud Take Center Stage

Since becoming Alibaba's CEO, Eddie Wu has consistently adhered to two core strategies: "E-commerce" and "AI + Cloud."

He has stated that Alibaba plans to invest over RMB 380 billion in cloud and AI hardware infrastructure over the next three years — an amount exceeding the company's total investment in this area over the previous decade.

Key priorities include:

• AI + Cloud: Positioned as the core growth engine
• Instant retail: Continued investment, with deep integration of Taobao Flash Delivery and Ele.me resources
• Global supply chain: Advancing "cross-border e-commerce + local services" through Lazada and AliExpress

At the recently concluded 2026 Apsara Conference, Wu reiterated that Alibaba remains committed to building a full-stack AI system, covering a five-layer architecture: chips, infrastructure, cloud models, model services, and intelligent agent applications.

Huatai Securities analysts believe that based on current plans, Alibaba is expected to continue increasing investment in computing power, with spending intensity likely exceeding the previously announced RMB 380 billion target.

In essence, the contraction of non-core businesses reflects a fundamental shift in Alibaba's strategic focus.

The e-commerce giant is accelerating its pivot toward AI.