By Yingzhi Yang and Tony Munroe

BEIJING (Reuters) – Chinese search giant Baidu Inc said on Monday that its artificial intelligence chip unit Kunlun recently completed a round of fundraising, which according to one source with direct knowledge of the matter values the business at about $2 billion.

The fundraising, which comes as the company pushes forward with AI chip design and manufacturing ambitions, was led by Chinese private equity firm CITIC Private Equity Funds Management (CPE), the source said. Other investors include IDG Capital, Legend Capital and an industry fund Oriza Hua, the person added.

“Kunlun chip business has recently completed a round of financing. We will release more information in due course,” Baidu said in a statement sent to Reuters on Monday, declining to comment on the investors, fundraising amount or valuation.

CPE, IDG, Legend Capital and Oriza Hua’s parent Suzhou Oriza Holdings didn’t immediately respond to requests for comment. The source declined to be named as the information is not public.

Kunlun chips are currently used mostly by Baidu on smart electric vehicles and cloud computing.

Baidu is considering commercializing its AI chip design capabilities, with the aim of making the Kunlun unit a standalone company, according to the source.

Baidu also operates another chip unit called Honghu.

Last week, Nasdaq-listed Baidu began raising a targeted $3 billion as part of its plan for a secondary listing in Hong Kong.

(Reporting by Yingzhi Yang and Tony Munroe; Editing by Shri Navaratnam)