Core Scientific shareholders voted down an all-stock acquisition offer from partner and competitor CoreWeave on Thursday. The offer was valued at nine billion dollars at the time. The decision followed a vote-no recommendation from the company’s largest shareholder, Sina Toussi of Two Seas Capital. This firm focuses on post-bankruptcy companies. Core Scientific itself had emerged from its bankruptcy in January 2024.
Both Core Scientific and CoreWeave share an early history in crypto mining. Core Scientific began as a crypto miner and continues that business today. CoreWeave also started as a miner but has since transitioned to serving AI workloads, aided by investor and partner Nvidia. Since its initial public offering, CoreWeave’s stock has soared, taking its market capitalization from fourteen billion dollars to sixty-six billion dollars today. This surge reflects investor enthusiasm for artificial intelligence, and CoreWeave has been using its highly valued stock to make acquisitions.
Prior to the acquisition attempt, CoreWeave had already signed a massive ten billion dollar, twelve-year contract with Core Scientific to use its facilities for AI services. The subsequent offer to buy the company outright was made at a premium to Core Scientific’s share price at the time. However, investor Sina Toussi believes Core Scientific can transform into a company like CoreWeave on its own. In his opposition letter, he noted that investment in AI infrastructure has accelerated, driving up the valuations of Core Scientific’s peers. He questioned why shareholders would accept a deal worth only sixteen dollars and forty cents per share.
Following the vote, CoreWeave walked away from the deal. Core Scientific’s stock price rose on the news, and the company now has a market capitalization of six point six billion dollars. Investors turning down such a large acquisition bid in pursuit of a potentially bigger future offer is seen by some as a sign that the market is in, or heading for, an AI bubble.
Meanwhile, CoreWeave continues its shopping spree. On the same day the Core Scientific deal fell through, CoreWeave acquired Marimo, an open-source competitor to Jupyter Notebooks, for an undisclosed sum. PitchBook estimates that Marimo had raised about five million dollars. Python notebooks are development tools that combine code, media, and text into a single shareable file. They are often used for interactive data analysis and AI application development. This acquisition helps CoreWeave in its attempt to move up the stack from providing hosting services to building AI applications.