VivoPower International PLC (VVPR) shares traded higher on Friday after the company unveiled a clever way to get exposure to Ripple Labs without actually spending any of its own money. It's the kind of financial engineering that sounds too good to be true, but here's how it works.
The company's digital asset subsidiary, Vivo Federation, signed a definitive joint venture agreement with Lean Ventures, a licensed asset manager based in Seoul. Together, they plan to establish a special-purpose investment vehicle that will acquire and hold up to $300 million of Ripple Labs shares. The twist? South Korean investors are footing the bill.
How the Deal Works
Lean Ventures has already gauged interest from qualified institutional and retail investors in South Korea, where it manages capital for government-linked entities and private limited partners. Meanwhile, Vivo Federation will source and procure Ripple Labs shares for the new investment vehicle.
VivoPower recently secured written approval from Ripple to purchase an initial block of preferred shares. The company is also negotiating directly with institutional holders for additional Ripple equity, with management estimating potential transactions could total roughly $300 million.
Under the agreement, Vivo Federation will earn management fees and performance carry, the standard arrangement for fund managers. VivoPower targets net economic gains of $75 million over three years from this structure. The company emphasized it will not commit balance sheet capital, which preserves financial flexibility while still capturing upside exposure to Ripple Labs and XRP-linked assets.
Why South Korea Matters
South Korea isn't just a convenient partner here. The country represents one of the world's largest XRP holder bases by value and volume, making it a natural fit for a Ripple-focused investment vehicle.
Adam Traidman, Chairman of VivoPower's Advisory Council, said: "We are delighted to have entered into this partnership with Lean Ventures, given its established status and reputation in South Korea."
Chris Kim, Managing Partner of Lean Ventures, said: "There is significant appetite in South Korea amongst institutional and retail investors seeking to gain exposure to Ripple Labs shares." Kim added that the partnership aims to provide structured access at a discount to public market valuations.
The Bigger Picture
Management said this structure improves risk-adjusted returns while aligning with VivoPower's broader digital asset strategy. The company said due diligence continues on related strategic investments, suggesting this may not be the last deal of its kind.
For investors, the appeal is straightforward: VivoPower gets to participate in Ripple's potential upside without the downside risk of tying up its own cash. It's a capital-light approach to digital assets that could become a template for similar ventures.
VVPR Price Action: VivoPower International shares were up 14.96% at $2.91 at the time of publication on Friday.