Marathon Digital Holdings Advances Bitcoin Mining Expansion with $179 Million Acquisition of Two Operational Sites

Bits Logics Team . 20th Dec 2023

• Marathon Digital Holdings announces plans to acquire two operational Bitcoin mining sites with a combined capacity of 390 megawatts.
• The deal, valued at $178.6 million, marks Marathon’s transition from an asset-light organization to one managing a robust portfolio of Bitcoin mining operations.
• This transaction is set to elevate Marathon’s capacity to approximately 910 megawatts.

In a strategic move to bolster its position in the Bitcoin ecosystem, Marathon Digital Holdings, Inc. announces a definitive agreement to acquire two operational Bitcoin mining sites with a combined capacity of 390 megawatts. The deal, valued at $178.6 million, marks Marathon’s transition from an asset-light organization to one managing a robust portfolio of Bitcoin mining operations.

The acquisition, Marathon’s first of fully owned sites, underscores its commitment to vertical integration and diversification within the rapidly evolving digital currency landscape. Currently boasting a Bitcoin mining portfolio of 584 megawatts, this transaction is set to elevate Marathon’s capacity to approximately 910 megawatts. The company aims to manage 45% of this capacity directly, with the remaining 55% hosted by third parties.

Fred Thiel, Marathon’s Chairman and CEO, emphasizes the significance of this move, stating, “By acquiring the sites in Granbury, Texas and Kearney, Nebraska from Generate, we have an opportunity to reduce our bitcoin production costs at these sites, to capitalize on energy hedging opportunities, and to expand our operational capacity.”

The acquisition includes the transfer of ownership for data centers in Granbury, Texas, and Kearney, Nebraska, currently operated by third parties. The deal, expected to close in the first quarter of 2024, involves a cash payment from Marathon’s balance sheet.

Salman Khan, Marathon’s Chief Financial Officer, highlights the immediate accretive impact of the transaction, stating, “With our strong balance sheet, we were able to quickly advance the mutually beneficial purchase agreement of these assets without having to add debt or issue future equity.”

The move not only expands Marathon’s operational footprint but also presents opportunities for cost reduction, increased operational efficiency, and potential hash rate growth. Marathon aims to double its current operational hash rate to approximately 50 exahashes over the next 18-24 months.

David Hirsch, Principal at Generate Capital, acknowledges Marathon as an excellent partner and notes that this transaction aligns with both organizations’ long-term strategies. As Marathon strengthens its position in Bitcoin mining, Generate can redirect resources to sustainability initiatives in the digital and energy infrastructure sectors.

The acquisition is a testament to Marathon’s commitment to innovation and strategic growth in the dynamic landscape of digital currencies.