VivoPower International, a solar company listed on Nasdaq, announced on Friday that its stock price surged by 32.12% to $5.10 after revealing plans to acquire $100 million worth of private shares in Ripple Labs, further advancing the company's strategy centered around digital asset reserves with XRP.
The company stated in a press release on Friday that it decided to take this action after two months of due diligence. VivoPower will acquire Ripple shares directly from existing shareholders, and the transaction must be approved by Ripple's executive team.
Kevin Chin, VivoPower's Executive Chairman and CEO, stated, "Our portfolio construction strategy is to simultaneously purchase Ripple shares and XRP. This will help us maximize returns while reducing the weighted average cost of the acquired XRP."
VivoPower will also continue to directly acquire XRP, becoming the first U.S. publicly listed company to offer investors both Ripple equity and XRP investment channels.
To advance this strategy, VivoPower will collaborate with BitGo for asset custody and will conduct share trading through the Nasdaq private market, which is Ripple's preferred partner for private equity transactions. An independent auditing firm will audit its Ripple assets quarterly.
Ripple initially issued 100 billion XRP and has burned approximately 14 million XRP to date. Currently, Ripple holds 41 billion XRP, primarily in custody accounts. In addition to XRP, the company also operates the RLUSD stablecoin, the digital asset prime brokerage Hidden Road, custodial institutions MetaCo and Standard Custody & Trust, as well as the stablecoin payment platform Rail.
VivoPower's management believes that the combined strategy could reduce the average acquisition cost of each XRP to an implied $0.47, an 86% discount compared to the current market price. This calculation only considers the number of XRP held by Ripple and does not account for the value of the company's other business segments.
The company stated that for every $10 million of Ripple shares acquired, it is expected to bring approximately $5.15 in book value per share to VivoPower shareholders, although the actual effect remains subject to market fluctuations.
On Tuesday, South Korean crypto custody institution BDACS launched compliant XRP custody services following its partnership with Ripple established in February. This service leverages Ripple Custody's enterprise-level solutions to provide institutions with secure storage and management capabilities for XRP.
Earlier this year, Ripple Labs partnered with South Korean crypto custody institution BDACS to provide custody support for institutions holding XRP and its USD stablecoin RLUSD.
Related: As Bitcoin (BTC) and Ethereum (ETH) recover, inflows into crypto ETPs reach $572 million.
Original article: “VivoPower Shares Soar 32% After $100 Million Plan to Acquire Ripple to Increase Holdings in XRP”
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