What happened

Shares of VivoPower International (NASDAQ:VVPR) were trading higher on Monday, after the company announced it has agreed to a deal with a distributor that will offer its electric vehicle conversions in Australia. 

As of 1:30 p.m. EST, VivoPower's shares were up about 22.7% from Friday's closing price.

So what

This will take a bit of explaining.

London-based VivoPower has a 51% stake in a Dutch company called Tembo e-LV, which installs electric drivetrains in Toyota Land Cruiser SUVs and Hilux pickups. Tembo also sells kits to convert vehicles to battery-electric operation.

GB Auto is a privately held Australian company that sells vehicles and equipment to clients in the mining, construction, transportation (think buses), and agricultural sectors. GB Auto has a subsidiary, called GB Electric Vehicles, that sells -- you guessed it -- electric vehicles, specifically to mining companies for underground operation. 

So here's the news: Tembo has signed a definitive agreement with GB Electric Vehicles, under which GB becomes the exclusive Australian distributor of Tembo's trucks and conversion kits. 

A white Tembo work truck parked next to a GB Auto office.

GB Auto will distribute Tembo's Toyota-based electric trucks in Australia. Image source: GB Auto.

Now what

It's a substantial piece of business for VivoPower. The company said in a statement that it expects GB Auto to purchase $250 million worth of vehicles and conversion kits over the four-year term of the deal. 

That, plus the intense investor interest in everything having to do with electric vehicles, is why the stock is up today.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.