China’s Alibaba Group says its CEO, Eddie Wu, would lead its core e-commerce business as the company seeks to boost growth and fend off fast-growing online shopping rivals like Pinduoduo.

Wu is replacing Trudy Dai, a longtime Alibaba executive who was one of the founding employees of the company.

Alibaba’s chairperson, Joe Tsai, said in an internal letter dated Wednesday that Dai will help set up an asset management company to improve returns on capital and "enhance shareholder value."

The reshuffle came after PDD Holdings Inc., which operates online shopping platform Pinduoduo and U.S.-focused e-commerce site Temu, surpassed Alibaba in market value in the past month.

PDD’s market capitalization of its U.S.-listed stock as of Tuesday was $199.41 billion. Alibaba’s was $191.75 billion.

Alibaba founder Jack Ma praised PDD earlier this month for having grown bigger than his Hangzhou-based company, which had been China’s biggest e-commerce player for years.

Alibaba needs a "brand-new strategy" and a change in the firm’s organizational principles and systems to a "brand new environment," Tsai said in his letter.

After the announcement, Alibaba’s Hong Kong-listed stock rose 3.5% in trading on Wednesday.

The company restructured its businesses in March, splitting them into six units that would eventually raise their own capital and go public.

Its cloud unit had been expected to be among the first to hold an initial public offering (IPO), but Alibaba later scrapped plans to spin off the business, citing uncertainties over U.S. export curbs on advanced chips used for artificial intelligence.