CoreWeave to Acquire Bitcoin Miner Core Scientific in $9 Billion All-Stock Deal to Expand AI Infrastructure

CoreWeave, a company specializing in the provision of artificial intelligence infrastructure, has announced a landmark acquisition of Core Scientific, a prominent Bitcoin mining firm based in Texas, through an all-stock transaction valued at approximately $9.5 billion. The announcement made on Monday indicates that this strategic move aims to bolster CoreWeave’s capabilities in AI infrastructure while securing access to over 1.2 gigawatts of data center power across the United States, critical for enhancing computational efficiency.

Under the terms of the deal, shareholders of Core Scientific will receive approximately 0.125 CoreWeave Class A shares for every share they own. This valuation sets Core Scientific shares at around $21.5315 each, reflecting a significant premium of 67% compared to its closing price experienced at the end of June. Both companies have already given their board approval for this merger, which is anticipated to finalize in the latter part of 2025, pending regulatory approvals and necessary votes from Core Scientific shareholders.

An interesting aspect of this agreement entails the cancellation of an earlier 12-year, $10 billion hosting arrangement between the two companies. This arrangement previously saw CoreWeave leasing capacities at several facilities owned by Core Scientific. The new acquisition shifts CoreWeave’s stance from a lessee to outright owner of these essential data centers, which were initially established for Bitcoin mining but will now also serve to support AI-related computational tasks. CoreWeave’s CEO, Michael Intrator, emphasized that this acquisition not only enhances operational efficiency but also mitigates potential risks associated with the business operations.

Core Scientific had faced substantial challenges prior to this acquisition, having declared Chapter 11 bankruptcy in December 2022 amid declining Bitcoin prices and soaring energy costs. However, the company successfully navigated a reorganization and resumed operations in early 2024, relisting on Nasdaq under the ticker symbol CORZ. This history of volatility indicates that the merger could provide both stability and growth potential for the newly formed entity.

In June of the previous year, Core Scientific had turned down a $1 billion acquisition offer from CoreWeave. Nonetheless, the companies maintained collaboration through the hosting agreement executed later that year. With the new acquisition, CoreWeave will obtain full ownership of the Core Scientific facilities, eliminating future rental payments and allowing them to fully control the infrastructure necessary for their expanding AI initiatives.

In the immediate aftermath of the announcement, Core Scientific’s stock saw a sharp decline of approximately 16% during early trading on Monday. Concurrently, shares of CoreWeave also experienced a dip of about 5% during the morning session, with prices falling from around $167 to about $158.77. These reactions from investors highlight prevailing concerns over the financial implications and logistical execution of the merger.

Another noteworthy aspect of this transaction is the anticipated distribution of shares post-merger. When the deal is concluded, Core Scientific investors will possess less than 10% of the consolidated company, indicating that CoreWeave will maintain a significant controlling interest exceeding 90%. This ownership structure will afford CoreWeave considerable autonomy in steering the strategic direction and operational framework of the combined entity.

CoreWeave has witnessed notable growth in recent years, primarily by leasing high-performance computing clusters utilizing Nvidia GPUs. Their client portfolio includes major firms such as Microsoft and OpenAI, leading to a focused expansion toward more affordable energy sources. With this acquisition, CoreWeave enhances not only its infrastructure capabilities but also secures long-term power agreements, allowing for a more rapid expansion strategy without reliance on external lease agreements.

Additionally, the merger is expected to establish a formidable presence of data center facilities across various states in the U.S., significantly amplifying CoreWeave’s operational footprint. Furthermore, Core Scientific’s assets include approximately 1,000 Bitcoins, which translates to an estimated worth exceeding $110 million. This asset will be integrated into CoreWeave’s financial portfolio, adding further value to the acquisition.

As the merger awaits regulatory approval and shareholder endorsement, the implications of this deal suggest a significant leap for CoreWeave in the competitive landscape of AI infrastructure and cryptocurrency mining operations. By capturing Core Scientific’s resources, CoreWeave not only solidifies its position in the AI sector but also positions itself strategically within the broader cryptocurrency environment, potentially paving the way for future innovations and growth collaborations.