VivoPower International PLC (NASDAQ:VVPR, FRA:51J) has pivoted from digital assets and legacy solar development to focus on a unique and highly strategic niche: sovereign AI data centers. These facilities, considered national-interest infrastructure, are designed to house the intelligence of sovereign nations, and VivoPower aims to become a trusted partner for governments, wealth funds, and influential families. By leveraging these relationships, the company gains access to sites, scale, and regulatory insulation that competitors cannot easily replicate.
Executive chairman Kevin Chin sat down with Proactive to explore how VivoPower’s strategic focus, disciplined execution, and long-term vision position it for sustainable growth.
Proactive: The company has pivoted from digital assets and legacy solar projects to focus on sovereign AI data centers—a term that might not be familiar to our readers. How would you explain that, and what does this approach mean for VivoPower’s growth?
Kevin Chin: With respect to sovereign AI data centers, the term “sovereign” is deliberate and central to our strategy. Unlike traditional cloud or crypto mining facilities, AI data centers are highly sensitive assets that can be viewed as national-interest infrastructure because they effectively house the intelligence of a sovereign nation. Our objective is to become the most trusted, independent, and neutral partner to selected sovereign nations, leveraging strong relationships with sovereign leaders, wealth funds, and influential families in certain jurisdictions.
That focus shapes our strategy: delivering land and infrastructure purpose-built and powered specifically for AI data center use cases. Geographically, we aim to be global but targeted, concentrating on three core regions—the Nordics, specifically Finland and Norway; the GCC, currently the UAE and Saudi Arabia; and Asia, initially South Korea and Malaysia, with potential expansion into additional markets. Together, these regions provide substantial opportunity and more than enough scope to execute our strategy over the next three to five years.
We’ve seen recent news about your moves in Finland and the UAE, acquiring land and megawatts. How do these moves fit into VivoPower’s overall strategy?
Correct. To explain our business model, we’re very focused on the “bricks and mortar” end of the value chain. We acquire land, develop it, build, own, and lease what we call powered shells.
Think of it like developing and building a hotel: we don’t operate it ourselves, but lease it out to operators on long term rental deals. In our case, tenants include hyperscalers like Microsoft and Google, emerging cloud providers, or government bodies that want to house their data in sovereign facilities within their own country.
In very simple terms, that’s our model: we provide the powered land and infrastructure so these organizations can operate securely and efficiently without having to build and maintain the facilities themselves.
Would it be fair to characterize this as an AI infrastructure strategy rather than a pure-play AI investment?
Absolutely, spot on. It’s about land and infrastructure in the form of data centers purpose-built for AI use cases. We’re not trying to pick winners in AI technology itself—the hardware, the software, the GPUs. Instead, we play to our strengths as a team: our expertise in real estate, infrastructure and finance. That’s where we can create real value.
Strategic partnerships with sovereign nations seem central to your approach. How does that give VivoPower an edge in the AI compute market?
A good example is our UAE site. It’s a 25-megawatt facility, with land capacity allowing for expansion up to 100 megawatts, in partnership with a sovereign family office.
Looking ahead, AI data centers are significant assets and consume substantial power and water. We’re already seeing societal pushback in parts of Europe, the US, and Australia. These assets could become national-interest or politically sensitive. Governments may regulate or tax them to reinvest in their citizens.
This is why corporate diplomacy and our stature as a certified B Corporation focussed on the triple bottom line of people, planet and profit is critical. By working hand-in-glove with sovereign partners, we seek to engender alignment and create value for the societies and nations where these data centers are built and operate. We believe this can help us navigate political and regulatory landscapes, and position VivoPower as a trusted, long-term partner in AI infrastructure.
It’s a fascinating niche you’re occupying, tapping into AI trends while leveraging your relationships. Before we wrap up, let’s talk about catalysts for investors. Your Tembo EV spin-off is nearing completion. What does retaining part of that business mean for VivoPower’s long-term strategy?
Tembo is an electric vehicle business targeting a large niche in off-road and ruggedized on-road applications, where battery performance and range can vary significantly due to terrain. It focuses on practical solutions for sectors like mining, agriculture, and safaris, a global market valued at over $100 billion with few competitors. The business model has three pillars: conversion kits that electrify existing diesel and petrol vehicles such as Land Cruisers, used by safari operators and clients in mining, defense and other sectors globally; electrifying public utility vehicles, specifically the Jeepneys in the Philippines through a partnership with Sarao Motors, a $10 billion market where we are also addressing roughly a third of the country’s emissions; and Tembo’s Tusker, a fully electric pick up utility vehicle that is equally adept on-road as well as off-road. Tembo filed its F-4 prospectus in late December, with an IPO expected in the near future at an $838 million valuation. VivoPower will retain 45% to 49%, representing in excess $400 million in shareholder value. We expect Tembo will be tightly held with a free float estimated to be less than 2%, given there are other strategic investors on the capitalization table, as well as a large percentage to be held by the Tembo board and staff.
Building AI data centers is capital intensive. How are you approaching funding without over-diluting shareholders?
This is a critical question, for our investors and for us as major shareholders ourselves. We want to avoid dilution as much as possible and we have demonstrated discipline in this regard, in recent times with strategic PIPE raisings at a premium to market. We steadfastly have declined structured PIPE proposals that have been presented to us.
What is helpful too is that we are seeing in the market the appetite to fund up to 100% of an AI center development with asset backed construction debt, obviating the need for equity. Obviously 100% asset backed construction finance would be first prize. There is strong appetite from hyperscalers for powered land that can be energized within 12 to 18 months. For the right sites, hyperscalers are prepared to commit to a long-term pre-lease, which in turn enables developers like ourselves to raise up to 100% construction debt financing (with the right credentials and relationships).
If we cannot or do not wish to secure 100% construction financing, we can still secure asset backed debt of 80% — 65% senior and 15% mezzanine. The remaining 20% equity can come from our own balance sheet and we have the relationships globally to be able to bring in sovereign or strategic equity co investors that can fortify our investment.
Last but not least, we may tap the public market, but only very judiciously and ideally where we can do so at a strategic premium or under favorable conditions, ensuring that any funds raised are accretive to shareholders.
The above strategic approach allows us to finance large, capital-intensive projects efficiently, preserve shareholder value, and leverage sovereign partnerships to achieve strategic outcomes.
And it all ties back into your strategy of partnering with sovereign nations, doesn’t it?
That’s right. Looping back to Tembo and electric vehicles, there is definitely a nexus here. As the world moves toward electric and autonomous vehicles, this industry will become a significant user of AI data centers, given growing training and inferencing needs. In essence, the convergence of power and data will transcend multiple industries and the mobility industry will be one of the biggest globally.
For example, in the Philippines, as we electrify and modernize the Jeepney fleet, these vehicles will also serve as data “trojan horses”. The training and inferencing needs could require up to an estimated 100 megawatts of AI compute capacity in future. Electric and autonomous mobility is a key use case that ties directly into our broader AI infrastructure strategy.
What do you want retail investors and readers to understand about VivoPower and its near-term trajectory?
Firstly, our foundation has always been as an electric power company. The genesis of VivoPower was based on a conviction that the electrification of everything would be a multi-decade megatrend. From our roots as a solar developer, we turned our attention to electric mobility, then introduced our Power to X strategy in 2021. We talked about how the X is the highest and best use case of power and for us that led us into the digital asset world with mining initially and then the establishment of a digital asset treasury unit. Today, the X is AI compute, and our strategy is now solely focussed on executing on the scale up of our powered land fit for AI use cases. As stated, we focus on the bricks and mortar end of the AI value chain being the land, the power rights and also the data centers.
We’re now at an inflection point where several key work streams are coming to fruition. Near-term catalysts include the Tembo spin-off IPO and the build-out of our AI data center portfolio, which we believe will be valued in line with comparable assets over time.
Last but not least, our ticker change to VIVO and our simplified corporate name of VivoPower PLC reflect our commitment and focus to our AI data center strategy.