We briefly review the announced sale of Long Ridge, one of the core assets within Fortress Infrastructure. We were previously involved in FIP on the trading side, but ultimately concluded that the company lacked the characteristics required for a long-term investment. The main reasons were execution risk, limited evidence of value creation across several assets, and a capital structure that we believe remains heavily skewed in favour of preferred capital providers.
This week, after several years of attempts, the company announced the sale of Long Ridge Energy to MARA Holdings for a total transaction value of approximately $1.52Bn, with closing expected in 3Q26.
Long Ridge – Transaction Analysis
The headline transaction value appears sizeable. However, the underlying economics are less supportive. Less than a year ago, FIP rejected an offer of $1.6Bn, equivalent to approximately $500MM of equity value, because management argued that Long Ridge was worth closer to $2Bn. The final transaction has now been agreed at $1.52Bn, implying equity proceeds of approximately $366MM.
This represents a $134MM gap versus the previously rejected offer. It suggests that either the earlier valuation expectations were too optimistic, or that asset-level value deteriorated while the company was trying to secure the data centre opportunity that management had been discussing for several years.
From a balance sheet perspective, the sale eliminates approximately $1.15Bn of Long Ridge debt and allows FIP to reduce corporate debt by roughly $300MM. Cash interest should decline meaningfully, leverage metrics improve, and near-term financial flexibility increases.
The problem is that Long Ridge was also one of the few assets that could have validated the company’s value-creation narrative. Instead, FIP sold the asset below the price previously rejected, after failing to convert the data centre optionality into a premium outcome.
How FIP Looks After the Sale
Excluding Long Ridge, the remaining business is significantly narrower. Based on our FY26 estimates, the group generates approximately $220MM of EBITDA: Railroads at around $185MM, Jefferson at around $70MM, Repauno approximately breakeven ahead of Phase 2, and corporate costs of approximately $35MM.
The structural issue is visible immediately. Jefferson generated $13.6MM of quarterly EBITDA against $15.4MM of quarterly interest expense, meaning it does not currently cover its own debt service. Repauno remains cash-flow negative, with Phase 2 now targeting operational commencement in 1Q27. The Railroad segment is therefore the only business with consistent earnings power, generating approximately $41MM of quarterly EBITDA against limited asset-level interest.