Baidu looks for $2 billion in fundraising to catch up with Alipay and WeChat Pay

25 January 2018

Baidu According to the report provided by Reuters, citing unnamed sources with the knowledge of the matter, Baidu Inc, a Chinese online search giant, eyes to raise as much as $2 billion in a move to reshuffle its financial service unit as its major rivals in the industry, Alipay and Tencent, are controlling a larger part of the mobile and online payments sector.

According to the sources, Baidu will attract investors to either purchase shares in its Baidu Financial Services Group or acquire its holdings in the company currently valued at about $2.8 billion. At the moment the searching giant is holding negotiations with potential investors over prospective fundraising, which is estimated between $1.5 billion to $2 billion. Baidu plans to get about 50% of the amount from the sales of its stakes in the business unit. The deal is expected to close by this April.

Baidu FSG is operating Baidu Wallet, a payment system providing online credit services and wealth management tools. The funds are expected to help the company to improve its position among the leaders in the market, as Baidu seeks to access more revenue sources beyond its key business in the searching industry.

Baidu provided no comments on the deal and the sources expressed their willingness to remain unnamed as the plans on the transaction are confidential.

Baidu Wallet recorded about 100 million users of its online credit services at the end of 2016, which is remarkably inferior to the number of customers using Alipay and WeChat Pay services in the mobile payments ecosystem in China.

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