Marathon Disclosed an $87.3 Million Deal for a Texas Bitcoin-Mining Site

Marathon Digital Holdings announced on March 15, 2024 that it had agreed to acquire Applied Digital’s Bitcoin-mining data center in Garden City, Texas, for a base cash price of approximately $87.3 million, subject to adjustments and closing conditions.

The companies signed the purchase agreement on March 14 and disclosed it through March 15 announcements and filings. The distinction matters: March 15 marked the public disclosure, not the transaction’s completion. Marathon’s subsidiary agreed to acquire the facility and assume its underlying ground lease, with closing expected during the second quarter of 2024.

The deal was consequential because it represented a shift from third-party hosting toward direct ownership by a large publicly traded Bitcoin miner. It also demonstrated how infrastructure operators were beginning to separate Bitcoin-mining assets from data centers intended for artificial-intelligence and other high-performance-computing workloads.

What Marathon agreed to acquire

The Garden City campus had 200 megawatts of nameplate capacity. Nameplate capacity describes the site’s designed electrical limit; it does not mean all 200 megawatts were energized or supporting miners on March 15.

Marathon said approximately 100 megawatts at the site were supporting about 4.5 exahashes per second of its mining equipment. The company expected to add another 100 megawatts during 2024, although only 32 megawatts of that expansion were expected to be available at closing. The remaining capacity depended on regulatory approvals.

Applied Digital owned and operated the infrastructure but said it did not own the mining machines installed there. Marathon was already a major customer under a multiyear hosting agreement. The acquisition therefore proposed transferring the property and operational control surrounding equipment Marathon was already using, rather than purchasing an unfamiliar mining fleet.

Dividing the disclosed $87.3 million base price by 200 megawatts produces approximately $436,500 per nameplate megawatt, consistent with Marathon’s rounded figure of $437,000. That calculation is not a valuation of energized capacity, computing output or future Bitcoin production. Land obligations, interconnection rights, equipment, uptime and expansion approvals can materially affect the economics of two facilities with the same nameplate rating.

Two different strategic objectives

Marathon said the transaction would increase the share of its mining portfolio located at sites it directly owned and operated. Before two earlier data-center acquisitions completed in January 2024, the company said only 3% of its 584-megawatt portfolio was directly owned and operated. After the Garden City acquisition and planned expansion, Marathon projected a 1.1-gigawatt portfolio with 54% under direct ownership and operation.

Those figures were management projections contingent on closing and expansion. Marathon also estimated that ownership would reduce its cost per coin at Garden City by approximately 20%. The filing did not provide an independently verified cost model, future Bitcoin output or evidence that the projected saving had already been realized.

Applied Digital framed the sale as part of its effort to concentrate resources on high-performance-computing projects in North Dakota. Its March 15 announcement described an approximately $87.3 million net price and a $97.3 million gross figure after contemplated adjustments. The SEC-filed agreement identified approximately $87.3 million as the base purchase price, so the figures should not be treated as interchangeable. Applied Digital also said the transaction would release $12 million of restricted cash pledged for the site’s letter of credit.

What remained uncertain on March 15

The agreement did not guarantee completion, approval of additional power capacity, uninterrupted operation or the projected cost reduction. It also did not establish how Bitcoin’s approaching subsidy halving would affect the site’s revenue after mining rewards declined.

No cryptocurrency or company-share price movement is attributed to the announcement. Establishing such a reaction would require a named instrument, venue, observation window and evidence separating the transaction from the broader March 15 selloff in digital assets.

Later confirmation

Subsequent SEC filings confirmed that the acquisition closed in early April 2024, although Applied Digital reported April 1 and Marathon reported April 2 as the completion date. That later confirmation establishes that the proposed transaction proceeded, but it was not available when the March 15 disclosure was made.