Baidu to offload majority stake in financial services unit
30 April 2018 | 4108 views | 0
Chinese internet search giant Baidu is to divest a majority equity stake in its financial services unit to a group of venture capital investors, raising $1.9 billion.
The Chinese language Internet search provider intends to offload a 58% stake in its Financial Services Group (FSG) unit, which provides a mobile wallet, consumer credit, wealth management and other financial services.
The investors are led by TPG and The Carlyle Group, with participation from Taikang Group, ABC International Holdings and others.
Baidu intends to use the funds generated from the transaction to invest further into the fintech ecosystem as it seeks to play catch up with local e-commerce rivals Alibaba and Tencent.
The deal, which is expected to be completed in the next quarter, will see FSG rebranded and re-launched as an independent entity under the new name Du Xiaoman Financial.
Guang Zhu, a senior VP at Baidu who has been named as CEO of Du Xiaoman, says: "In the coming age of fintech, Du Xiaoman will leverage the technological capabilities of Baidu AI to partner with financial institutions and provide technology-driven, trustworthy financial services to consumers in China."