China’s Alibaba Group said on Sunday that Daniel Zhang will step down from its cloud business, in a surprise move just two months after the company announced he would leave his roles as group CEO and chairman to focus on the cloud unit.

Share Market Live

NSE

Zhang had previously been concurrently serving in three roles, heading the group as well as its cloud unit.

As scheduled, he handed over the role of group CEO to Eddie Wu on Sunday, who will also take charge of the cloud business after Zhang’s departure, the company said in a statement.

The cloud business is a major part of a restructuring the Chinese e-commerce giant announced in March that breaks the company up into six units, each with its own boards and CEOs.

Alibaba said in May it aimed to complete the public listing of its cloud unit within the next 12 months and on Sunday the company said it would continue to execute the spin-off plan under a separate, to be appointed management team.

"Daniel has expressed his wish to transition away from his role as chairman and CEO of Cloud Intelligence Group," the company said in an internal letter to staff seen by Reuters that was signed by Joseph Tsai, an Alibaba co-founder who also took over the chairman role from Zhang as planned on Sunday.

"Following careful consideration, the Alibaba board respected and accepted Daniel’s decision and appointed Eddie as acting chairman and CEO of Cloud Intelligence Group, effectively immediately."

Zhang will continue to contribute to Alibaba by "channeling his expertise differently," the letter added, saying that Alibaba will invest $1 billion in a technology fund that Zhang would establish.

"The fund will support Alibaba’s strategy of investing for future growth and continuing to develop our technology ecosystem".