• SVP Zhu Guang will run newly spun-off finance division
  • New fintech company will be one of China’s best-funded

Baidu Inc. has raised more than $1.9 billion for its newly spun-off financial services division from TPG, Carlyle Group and other investors, creating one of China’s best-funded fintech companies.

Taikang Group and other backers also joined the funding round for the newly formed company, which will be called “Du Xiaoman Financial” and use artificial intelligence to provide short-term loans and investment services. Baidu Senior Vice President Zhu Guang will run the business as an independent entity, according to a statement Saturday. The news comes a day after Baidu said it planned to sell a majority stake in the business, without providing a timetable.

Baidu announced plans to spin off the unit in July, to help it obtain domestic financial services licenses and reduce drag on the parent, China’s most…