Marathon Digital to Buy Long Ridge Energy for $1.5B, Expanding Power Platform for AI/HPC

Marathon Digital (NASDAQ:MARA) executives outlined plans to acquire Long Ridge Energy & Power from FTAI in a transaction they described as a strategic expansion of the company’s energy and digital infrastructure platform, with a particular focus on AI and high-performance computing (AI/HPC) alongside flexible compute such as Bitcoin mining.

Strategic rationale: power as the core input

Chairman and CEO Fred Thiel said the acquisition fits into MARA’s push to “maximize long-term value by expanding into energy and AI HPC,” arguing that power availability and infrastructure are now the key bottlenecks in data center and compute markets. “Power is the most important input,” Thiel said, adding that MARA’s objective is to “dynamically allocate that power to maximize returns over time” across AI/HPC, critical IT infrastructure, and flexible compute.

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Thiel positioned Long Ridge as an immediately usable asset rather than a long-dated development project, emphasizing that the campus is already operational with existing infrastructure. “This is not raw land with a long development timelines,” he said, describing the site as having the “power,” “land,” “water,” “fuel supply,” and “interconnection” already in place.

According to Thiel, the Long Ridge Energy Campus would establish an AI/HPC data center campus in PJM Interconnection, which he called “one of the most active data center and power markets in North America.” He said the site supports “more than 1 gigawatt of total potential power capacity across generation and load,” including “up to 600 gross megawatts for AI HPC and critical IT loads.”

Asset overview and operating profile

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Management said the assets include a 505 megawatt (MW) nameplate combined cycle gas plant and more than 1,600 contiguous acres. Thiel called the plant “one of the most efficient combined cycle turbines in the PJM Interconnection” and said it provides “stable, cash-generative operations.” He also noted that MARA plans to retain Long Ridge Energy’s “team of 25 full-time engineers and employees” after closing.

Thiel said the site is anchored by MARA’s existing footprint at the Hannibal site, where the company already has “200 MW of existing MARA capacity already operating.” He added that the Hannibal location has seen interest from “investment-grade prospective AI HPC tenants.”

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Chief Growth and Strategy Officer Duncan Dickerson later said the power plant is currently operating at a “485 MW interconnect” and is selling power into the grid, with “about 76% hedged under a financial swap.” He said MARA does not currently intend to bring that generation behind-the-meter for data center projects, citing alternative growth paths through grid expansion and additional on-site power.

Thiel also addressed consumer impact, stating that MARA does not expect to reduce Long Ridge’s current supply of generation into the PJM grid and “does not anticipate any impact to consumers.” As behind-the-meter compute capacity is added, he said the company expects to “pair that demand with incremental generation over time.”

Development plans and demand commentary

Thiel said the company expects an “initial 200 MW AI HPC build-out,” with construction “beginning in around the first half of 2027” and “initial capacity coming online in mid-2028.” He tied execution to MARA’s partnership with Starwood Digital Ventures, which he said would help leverage development capabilities and tenant relationships.

In response to questions on how the AI/HPC build-out would be sequenced, Thiel said the “first target’s gonna be Hannibal” because it is “ready to go from an interconnect perspective and load perspective.” He described a phased build approach, noting that the first 200 MW could take “24 months potentially to build,” with additional phases following as more capacity becomes available.

On tenant interest, Dickerson said the company has received inbound interest across both AI workloads and critical IT workloads, and that demand has been “diverse.” He said the site’s location opens alternatives spanning “cloud or traditional workloads and AI and inference.” Dickerson added that inbound inquiries have included “investment-grade hyperscale tenants” as well as “neo clouds” and other customer types.

Transaction size and financing approach

Chief Financial Officer Salman Khan said Long Ridge is an operating asset generating free cash flow “not a development bet.” He said the power plant generates “approximately $144 million of annualized adjusted EBITDA,” with “about 76% contracted,” providing “stable, visible cash flow from day 1.” Khan also emphasized a vertically integrated natural gas and power plant structure, saying the platform operates at “less than $15 per MW-hour all in.”

On deal terms, Khan said MARA will acquire Long Ridge Energy for “approximately $1.5 billion,” including the assumption of “at least $700 million of debt” backstopped by a bridge loan from Barclays. He said the equity portion is expected to be funded through a combination of existing cash and Bitcoin-backed financing capacity.

Khan cited MARA’s liquidity resources as including “over $500 million of restricted and unrestricted cash,” “approximately $2.4 billion of BTC holdings based on a Bitcoin price of $70,000 per Bitcoin,” and “more than $2 billion of near-term liquidity.” He said the transaction is expected to be “immediately additive to EBITDA upon closing” and to provide free cash flow to help support AI/HPC development.

During Q&A, management clarified elements of the debt structure. Khan said existing asset-backed debt would remain with the asset, referencing “senior secured notes” and other facilities, while noting a Barclays backstop as the transaction progresses. Dickerson later added that “the term loan will be repaid at close,” using the Barclays bridge to support repayment and provide flexibility alongside existing bonds and other loans.

Scale impact and outlook

Thiel said the acquisition would increase MARA’s owned and operated capacity by 65%, and he described a post-transaction path that would take MARA from “1.3 GW today to 2.2 GW” with the addition of the Long Ridge plant and planned expansion. He characterized the platform as “multi-revenue,” with the ability to monetize power through AI/HPC leases, flexible compute operations, and wholesale power generation.

“We believe this transaction will give MARA a scaled power advantage platform, immediate durable cash flows, and a clear path to build one of the leading digital infrastructure campuses in the market,” Thiel said.

About Marathon Digital (NASDAQ:MARA)

Marathon Digital Holdings, Inc is a digital asset technology company specializing in the mining and acquisition of bitcoin. Headquartered in Las Vegas, Nevada, the firm employs high-performance application-specific integrated circuit (ASIC) miners and proprietary software to secure the Bitcoin network and expand its crypto-mining footprint. Marathon Digital focuses on operational efficiency and scalability, while maintaining rigorous standards for regulatory compliance and corporate governance.

The company operates multiple large-scale mining facilities throughout North America, including sites in Texas, Montana and New York.

The article “Marathon Digital to Buy Long Ridge Energy for $1.5B, Expanding Power Platform for AI/HPC” was originally published by MarketBeat.