(Bloomberg) — A consortium led by Alibaba Group Holding Ltd. and the Jiangsu provincial government are nearing a deal to buy a stake in the retail arm of Chinese billionaire Zhang Jindong’s Suning empire, according to people familiar with the matter, the latest domino to fall in Beijing’s effort to clean up its heavily indebted conglomerates.

The unit, Suning.com Co., could make an announcement as soon as this week, said the people, who asked not to be identified as the information is private. Zhang will no longer have control of the company after the deal, the people said, marking the end of his run as a high-profile entrepreneur who drove Suning into an array of businesses, including ownership of the Inter Milan soccer team.

Suning.com, one of China’s biggest retailers of appliances, electronics and other consumer goods, had a market value of about 52 billion yuan ($8 billion) before a trading halt on June 16. It’s been in trouble for some time: the retail business was weakened by the slowdown in spending during the pandemic, and concerns about its cash flow intensified in September, when Zhang waived his right to a 20 billion yuan payment from China Evergrande Group, the world’s most indebted property developer.

The stock tumbled to a nearly eight-year low in Shenzhen earlier this month after a Beijing court froze 3 billion yuan worth of shares held by Zhang — representing 5.8% of Suning.com, and as creditors agreed to extend a bond for Suning Appliance Group Co., which is owned by Zhang and fellow co-founder Bu Yang.

Read more: Billionaire Who Helped Evergrande Hit by Bond, Stock Selloff

China is taking advantage of a strengthening economy and stable financial markets to toughen up its corporate sector, discouraging the kind of reckless debt-fueled expansion that inflated some companies to a dangerous size. The spawning of such bloated empires created a threat to the financial system as well as a challenge to President Xi Jinping’s grip on power.

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Zhang’s Suning was a classic example as it dove into an array of sectors like real estate, finance and sports, including a controlling stake in Inter Milan for 270 million euros in 2016. The acquisition spree was characteristic of a group of Chinese conglomerates, including HNA Group Co. and Dalian Wanda Group Co., which have now been forced to unwind investments or go under government control.

Negotiations are ongoing and a deal could still be delayed or fall apart, the people said. A representative for Suning declined to comment, while representatives for Alibaba and the Jiangsu government didn’t immediately respond to requests for comment.

On its part, Alibaba is acting after a months-long probe into alleged monopolistic behavior, which saw it pay a record $2.8 billion fine earlier this year. The e-commerce giant already owns a 20% stake in Suning.com, a long-time ally in its broader physical retail strategy.

Zhang, who founded Suning in 1990, confounded investors when he waived his right to the Evergrande payment. The decision, which helped his friend and Evergrande chairman Hui Ka Yan save his own company, increased pressure on the retailer’s cash flow.

(Updates throughout)

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