Evergrande Acquires US Electric Vehicle Pioneer Protean

China Evergrande Group has acquired American in-wheel electric motor company Protean for an undisclosed sum, as China’s second largest property developer by sales ramps up efforts to become a leader in the alternative energy vehicle industry.

The Guangdong-based developer made the acquisition through subsidiary National Electric Vehicle Sweden (NEVS), a Swedish renewable energies vehicle manufacturer which was acquired by the group in mid-January, the company said in a filing to the Hong Kong Stock Exchange.

The real estate giant’s latest acquisition adds to a string of electric vehicle moves by its chairman Xu Jiayin, who vowed in March that, “Evergrande will strive to become the world’s biggest, and the strongest, electric vehicle group within three to five years,” according to a Bloomberg account.

Aiming to Take Over the EV Market

“Protean is the world leader of in-wheel electric motor technology for passenger cars,” Evergrande said. The ten-year-old Michigan-based company’s motors mount directly behind vehicle wheels, eliminating the need for a drive train, while delivering 100 horsepower per wheel.

The deal marks the real estate giant’s latest push to become the world’s largest electric vehicle maker amid a slowing real estate market in China, and comes only months after its break-up with disgraced billionaire Jia Yueting’s US-based EV start-up Faraday Future.

Under the terms of the deal, Protean will be merged with, and into, Virtue Serge Limited, which is a subsidiary of NEVS.

“Looking ahead, through the Acquisition, the Group is able to further consolidate its control over in-wheel electric motor technology,” Evergrande said in its filing.

Controlling Every Link in the Production Chain

The real estate developer’s expansion into the sector has already covered nearly the entire electric vehicle production chain from battery manufacture to distribution network, with the Shenzhen-based conglomerate spending more than $1.1 billion (excluding the latest acquisition) this year alone on an array of electric vehicle-related companies, and a total investment so far of RMB 28.3 billion ($4.1 billion).

Just two months ago, Hong Kong-listed Evergrande Health paid RMB 500 million for a 70 percent stake in TeT Drive Technology Co, a Hubei-based auto parts maker that owns e-Traction, an in-wheel motors and electric automobile powertrain systems enterprise headquartered in the Netherlands.

At the end of January, Evergrande made a RMB 1.1 billion investment in Chinese EV battery firm CENAT, as well as establishing a new EV company with a registered capital of $2 billion – Evergrande National New Energy Vehicle Group – in the southern Chinese city of Guangzhou around the same time.

Ten days earlier, the group pledged $930 million for a 51 percent share in NEVS, which had bought up bankrupt Saab in 2012.

Legal Battle with Faraday Future over $2B Investment

This series of moves came on the heels of Evergrande’s falling out with US-based high-end electric car maker Faraday Future, with the companies becoming embroiled in a legal dispute over ownership and payments last year following Evergrande’s agreement to invest $2 billion in the ailing carmaker.

The wrangle concluded with the original deal being restructured to allow Evergrande to retain a 32 percent stake in Faraday and control over its future development in China.

Evergrande’s most recent swoop into the EV market follows a bumper year for China with sales of 1.2 million new energy vehicles, accounting for more than half of the world’s total sales.

There are close to 400 electric vehicle manufacturers in the country as of last year, with sales are expected to double by 2020 and a slew of startups looking to join the production line.

Protean, named a Technology Pioneer in 2012 by the World Economic Forum, announced in December it had secured 150 global patents for its ProteanDrive in-wheel motor system that negates the need for gearboxes or driveshafts and lowers energy consumption.