Alibaba Group Holding Ltd. has appointed Wang Lei to head its new local services unit comprising its food delivery service Ele.me and its restaurant review and local services platform Koubei, the South China Morning Post reported Oct. 12, citing a company statement.

Alibaba Vice President Wang resigned as CEO of Alibaba Health Information Technology Ltd. in April to become CEO of Ele.me. The report said Koubei’s head, Chi Fan, will report to Wang and continue to lead the Koubei business.

In August, the Chinese e-commerce giant announced its plan to merge Ele.me and Koubei into a new local services unit, adding that it has already received $3 billion in a funding round led by Japan's SoftBank Group Corp.

The newspaper, which is also owned by Alibaba, said that Ele.me and Koubei operate in 676 cities in total, with a combined merchant base of 3.5 million.

"The goal of the local service company is not only for the food market, but to take on the bigger mission to redefine urban life and to make it better and more convenient,” Alibaba CEO Daniel Zhang reportedly said in a statement.

The report said the combined unit, which does not have an official English name yet, is expected to challenge Beijing-based Meituan Dianping, which last month raised $4.2 billion in its IPO in Hong Kong. Meituan-Dianping reportedly holds a 59.1% market share in China's on-demand delivery market.