FERC approves MARA's acquisition of Long Ridge natural gas power generation assets

AT A GLANCE

According to Matthew Sigel, FERC has approved MARA's acquisition of Long Ridge natural gas-fired power generation assets, but closing and expansion arrangements remain to be clarified.

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FERC approves miner MARA’s acquisition of the Long Ridge natural gas power plant

BlockBeats reports that on November 5, according to a post by Matthew Sigel, head of digital asset research at VanEck, the U.S. Federal Energy Regulatory Commission (FERC) has approved the transaction in which Bitcoin miner MARA Holdings (MARA) acquires the Long Ridge natural gas generation assets (case number EC26-92). Sigel stated that objections raised by market monitoring entities (IMM) citing BlackRock and Vanguard were not upheld, and FERC also declined to make keeping the plant’s output on the PJM grid a condition for approval.

According to his analysis, the enterprise value of this transaction is approximately 1,512,000,000 USD, corresponding to about 0.5 GW of natural gas generation capacity (approved output of 485 MW, nameplate capacity of 505 MW) and an annualized adjusted EBITDA of approximately 144,000,000 USD, valuing the asset at roughly 10.5 times EBITDA. Recently, gas-fired power transactions in PJM have been valued at around 7 times EBITDA; based on this calculation, the plant itself is worth about 1,000,000,000 USD. MARA paid an additional approximately 500,000,000 USD for land, gas wells, railways, and expansion options. MARA will retain approximately 900,000,000 USD of Long Ridge’s debt and will require an additional approximately 610,000,000 USD in cash, which it plans to cover with about 600,000,000 USD in Bitcoin-collateralized loans already drawn down from August. The external closing date for the transaction is November 30.

Sigel noted that MARA mentioned a total AI load of about 600 MW at this site, including approximately 200 MW of existing grid-connected load; it remains unclear whether the expansion will be conducted through a Starwood joint venture or whether MARA can retain up to 50% equity. He believes the next catalyst may come from lease agreements signed before or after closing.

Original article link https://m.theblockbeats.info/flash/375584

Key points

BlockBeats, citing Matthew Sigel, head of digital asset research at VanEck, reported that the U.S. Federal Energy Regulatory Commission (FERC) has approved MARA Holdings' acquisition of Long Ridge's natural gas-fired power generation assets, under docket number EC26-92.
Sigel stated that the objections raised by the market monitoring organization (IMM) were not upheld, and FERC also declined to make the continued retention of plant output on the PJM grid a condition for approval.
According to Sigel’s analysis, the transaction has an enterprise value of approximately 1512000000 USD, involving approved output of 485 MW, nameplate capacity of 505 MW, and annualized adjusted EBITDA of about 144000000 USD, with a valuation multiple of roughly 10.5.
According to the materials, MARA will retain approximately 900000000 USD of Long Ridge’s debt, require an additional approximately 610000000 USD in cash, and plans to cover this with approximately 600000000 USD worth of Bitcoin collateral loans already drawn by August.
The external cut-off date for the transaction is November 30.
Sigel noted that MARA mentioned the site’s total AI load of approximately 600 MW, which includes an existing grid-connected load of about 200 MW.
Sigel believes that the next catalyst may be the signing of leases before or after delivery.

AI-assisted interpretation

The following is analysis, separate from reported facts. Verify important claims independently.

The report says that the energy regulatory process is reportedly complete, but the acquisition has not yet been finalized. MARA plans to acquire a natural gas-fired power asset and assume its debt and cash outflows; the site was also used to discuss AI load. The expansion method, equity ratio, and lease terms have not been fully determined.

Why it matters to readers

Regulatory approval has reduced one uncertainty surrounding the transaction. If completed, MARA will acquire approximately 0.5 GW of natural gas-fired generation capacity, which could be used for its stated AI load planning; at the same time, about 900000000 USD of debt and about 610000000 USD in cash requirements will also create financial pressure.

Newcomers should distinguish between “regulatory approval” and “closing”: the former is merely a step in advancing the transaction. They should also monitor whether final financing, assumption of debt, lease signing, and AI load and expansion plans are actually implemented.

Risks and unknowns

The materials do not include the original FERC approval documents; the approval status, dispute resolution, and conditions of approval are all based on Matthew Sigel's account.
The transaction is still pending settlement, and it remains unconfirmed whether it can be completed before the external deadline of November 30.
The final financing arrangement for the approximately 610000000 USD cash requirement remains unconfirmed.

FERC approves MARA's acquisition of Long Ridge natural gas power generation assets

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