Chinese search engine and artificial intelligence (AI) giant Baidu is accelerating its push into the booming voice assistant sector that has spawned AI celebrities like Alexa.
Citic Private Equity Funds Management is teaming up with Baidu Capital and IDG Capital to pump an undisclosed amount of money in a series A round of funding into Baidu’s smart living unit, the Beijing-based company announced in a press release.
The deal is based on a valuation of $2.94 billion for Baidu’s Smart Living Group, which has spawned its own competitor to Alexa in the smart voice sector, DuerOS, as well as a line of DuerOS-powered smart devices.
Baidu said it expects the transaction to close in the fourth quarter of this year. The parent company, Baidu said it will hold super voting rights in its SLG unit and, as a majority shareholder, will continue to consolidate the financial results of SLG.
The deal could signal the potential spinoff by Baidu of its Smart Living Group into an independent entity, according to TechCrunch.
“We are pleased to see the rapid growth of SLG since inception in 2017, to become a leading player in China (and globally) in the fast growing voice assistant and smart devices market by leveraging Baidu’s AI capabilities,” said Baidu Chairman and CEO Robin Li in the press release announcing the funding. “This transaction marks another milestone for Baidu to incubate new businesses with its leading technologies and strong synergies from Baidu Core, to capture large market opportunities.”
Baidu in June unveiled a “strategic partnership” with smart device manufacturer Midea Group.
The agreement enables users of Baidu’s lineup of smart Xiaodu speakers to control an array of Midea smart home appliances.
China’s smart speaker market hit $235 million in sales during the first quarter, according to data analytics firm All View Cloud, a data analytics firm.
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