Baidu leads investment into green car start-up NextEV

SHANGHAI, March 17 (Reuters) - Baidu Inc said on

Friday it had led an investment round into green car start-up

NextEV, as the Chinese search engine giant looks for new growth

drivers and as competition heats up in the fast-growing electric

vehicles market.

Baidu is expanding into areas outside its core search and

advertising business to make up for sales which have taken a hit

from a tighter regulations and subsidy wars in different

segments with rivals such as Alibaba.

"We can confirm that Baidu has led investment in this round

of funding," a spokeswoman said in a comment sent to Reuters on

Friday. She declined to give an investment figure or name the

co-investors, but local media reported the overall funding round

was valued at up to $600 million.

China has splashed out billions of dollars in subsidies to

promote greener cars, creating a gold-rush among unknown

start-ups, but is now tightening its grip on the world's biggest

electric vehicle market to weed out weaker domestic firms.

The investment is the first for Baidu Capital, a 20 billion

yuan ($3 billion) investment fund Baidu set up late last year to

focus on mid- and late-stage deals in the internet sector.

NextEV already has the backing of tech giant Tencent

Holdings Ltd and Hillhouse Capital, and had targeted

to have raised 20 billion yuan in China and overseas by the end

of last year.

(Reporting by Adam Jourdan and Cate Cadell; Editing by

Muralikumar Anantharaman)