News Release Issued: Sep 21, 2021 (9:00am EDT)
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Talen Energy Corporation and Cumulus Growth Secure $175 Million of Capital from Orion Energy Partners
Talen Energy Corporation and Cumulus Growth Secure $175 Million of Capital from Orion Energy Partners
21/9
Investment Capitalizes the Cumulus Digital Infrastructure Platform By Funding the Carbon-Free Hyperscale Data Center Campus and Nautilus Coin Joint Venture with TeraWulf
THE WOODLANDS, Texas, Sept. 21, 2021 /
PRNewswire/ -- Talen Energy Corporation ("Talen") and its wholly-owned subsidiary Cumulus Growth Holdings LLC ("Cumulus Growth") announced today that they have taken additional steps forward in capitalizing and executing Talen's strategic transformation to a renewable energy and digital infrastructure growth platform. Cumulus Growth, through its wholly-owned subsidiary Cumulus Digital LLC ("Cumulus Digital"), has secured a 6-year, up to $175 million strategic capital partnership (the "Investment") with Orion Energy Partners ("Orion").
Talen Energy/Cumulus Growth, has secured up to $175 million in strategic capital partnership with Orion Energy Partners.
The Investment from Orion will be used to fund common infrastructure for the Cumulus hyperscale data center campus located adjacent to Talen's 2.5 Gigawatt Susquehanna carbon-free nuclear plant, as well as to fund Talen's previously-announced bitcoin mining joint venture with TeraWulf, known as
Nautilus Cryptomine. Up to $125 million of the Orion capital will be available following closing and an additional $50 million will be available once agreed milestones have been satisfied. In addition, Orion will receive a non-voting equity interest in Cumulus Digital Holdings LLC ("Digital Holdings"), the parent of Cumulus Digital. The Investment will be secured by a pledge of substantially all of the assets of Digital Holdings and its subsidiaries.
Concurrent with the Investment, subsidiaries of Talen Energy Supply LLC ("TES") sold the equity interests of certain clean energy project development entities (holding primarily: data center, renewables, and battery storage assets) and certain undeveloped land to Cumulus Growth, in return for voting convertible preferred equity interests in subsidiaries of Cumulus Growth. Post-closing, Talen will own common equity in Cumulus Growth and its subsidiaries and TES, and certain of its subsidiaries, will own voting convertible preferred equity in certain Cumulus Growth subsidiaries, which provide TES with equity participation in Talen's clean energy and digital infrastructure transformation.
"We are pleased to partner with Talen and Cumulus Growth on this exciting and differentiated ESG transformation," said Nazar Massouh, CEO and Co-Managing Partner of Orion. "Our firm was built on the core principle of funding energy transition and environmental innovation across infrastructure assets by partnering with exceptional management teams, entrepreneurs, and operators. We believe the Cumulus Growth strategy and infrastructure assets under development offer significant competitive advantages in accelerating the convergence between the clean power and digital infrastructure sectors," continued Mr. Massouh.
"We are grateful for the capital, partnership and confidence of Nazar Massouh and the entire Orion team," said Alex Hernandez, CEO of Cumulus Growth and President of Talen. "We have broken ground on the Cumulus data center campus, which will provide carbon-free energy generated by Susquehanna's dual units to power the campus, including up to 475 Megawatts for hyperscale data center clients and 300 Megawatts for coin mining and other blockchain applications. The Cumulus data center investment will create family-sustaining jobs, technology training, and other economic benefits including tax revenue and increased consumption of local goods and services to both Pennsylvania and the surrounding community. The first two Cumulus data centers, one for hyperscale cloud and another for coin applications, are expected to be completed by the second half of 2022," continued Mr. Hernandez.
"Digital infrastructure and clean power are converging and growing at an accelerating rate across the globe," said Gary Wojtaszek, former CEO of CyrusOne and Advisor to Talen and Cumulus Growth. "The Cumulus Growth platform is well-positioned to serve technology customers by providing carbon-free, low-cost, ultra-reliable electricity integrated with digital asset infrastructure at scale. These attributes enable the Cumulus Growth platform to offer the lowest total cost of ownership together with ESG benefits to hyperscale, cloud, AI, coin, and blockchain clients globally. Additionally, Cumulus Growth is expected to offer customers the ability to supplement its giga-scale carbon-free offering with 400 Megawatts of new solar generation capacity under development in Pennsylvania," continued Mr. Wojtaszek.
"We are excited to take the next step in Talen's journey as a Force for Good," said Drew Karian, Managing Director of Riverstone Holdings LLC. "Talen's growth into renewable, storage, and sustainable digital infrastructure solutions are tangible expressions of Riverstone's commitment to lead decarbonization at the scale required to make meaningful impact," continued Mr. Karian.