Internet game developer Beijing Kunlun Tech Co said its Hong Kong subsidiary has set up an artificial intelligence venture in the United States.

The announcement came on March 10 as Google Inc's AI supercomputer AlphaGo extended its lead over a South Korean Go master in a widely watched human brain versus machine showdown in Seoul.

The new company, Kunlun AI, will be based in Palo Alto, California.

The startup will develop advertising, voice-recognition and information-security technologies, Beijing Kunlun said in a statement.

Its Hong Kong subsidiary will make a $3 million investment to take a 15 percent stake in Kunlun AI, with the rest going to a number of unidentified investors, the statement added.

Hours after the announcement, AlphaGo beat Go champion Lee Se-dol again in the second faceoff of a 5-game competition.

Following its regulatory filing, the Shenzhen Stock Exchange issued the company a notice, seeking further clarifications on the US investment, including details on other investors and impact on its listed firm's financial performance.

It is not the first time Kunlun is investing in the AI sector. Earlier it acquired a 20 percent stake in the US robotics startup Woobo Inc for $800,000.

Liu Jiang, an analyst with Changjiang Securities Co, said: "Woobo is on the verge of introducing its hardware products and its robots can serve as a platform for Kunlun's AI technologies."

Liu said he believes the AI sector will be one of the key areas for the Chinese company to invest in.

Kuang Shi, an analyst with Bank of China International, said the focus of Kunlun will be overseas expansion.

"Kunlun's strategy is based on international expansion. The biggest reason for investors to buy shares in Kunlun is the company's overseas potential," said Kuang.

The company has been active in overseas acquisition in the past few months. In February, Kunlun, Qihoo 360 Technology Co and a number of Chinese firms offered to buy the Norwegian Web-browser developer Opera Software for $1.2 billion in cash.

In January, Kunlun purchased a 60 percent stake in homosexual dating application Grindr for $93 million. In June 2015, the company bought a 20 percent stake in the United Kingdom-based mortgage lender LendInvest Ltd for $34 million.

Zhou Yahui, chairman of Kunlun, has said he is looking to generate $1 billion in net profit by 2020 using Opera, social networking apps, financial services and the online video and gaming businesses.

gaoyuan@chinadaily.com.cn