CoreWeave, an AI infrastructure firm, has announced that it will acquire the Bitcoin mining company Core Scientific in an all-stock transaction. The deal is set to close in the fourth quarter of this year, with Core Scientific stockholders receiving 0.1235 newly issued shares of CoreWeave Class A common stock for each share of Core Scientific common stock they hold.
The total equity value of the transaction is estimated to be around $9 billion, with the final value to be determined at the time of closing. Following the merger, Core Scientific’s stockholders will own less than 10% of the combined company.
One of the key benefits of the acquisition is the immediate elimination of over $10 billion of cumulative future lease overhead, which will be paid for existing contractual sites over the next 12 years. Additionally, the deal is expected to result in $500 million of estimated annual cost savings by the end of 2027 through operational streamlining.
CoreWeave completed its IPO earlier this year, with the stock currently trading at $155.9, down 2.38% from its peak of $183 in June. Core Scientific, on the other hand, is trading at $14.63, down 1.35% from its peak of $18.23 last year.
The merger will provide CoreWeave with 1.3 GW of gross power, with an additional 1 GW+ of potential gross power available for expansion. This increased capacity will enable the company to achieve significant cost savings and reduce its cost of capital.
Michael Intrator, CEO and Chairman of CoreWeave, stated that the acquisition will allow the company to deploy AI and HPC workloads at scale, enhancing operational efficiency and de-risking future expansion. Adam Sullivan, President and CEO of Core Scientific, emphasized that the merged company will be well-positioned to accelerate the availability of world-class infrastructure for AI innovation.
Earlier this year, Core Scientific and CoreWeave announced a $1.2 billion data center expansion, which aims to create one of the largest GPU supercomputers in North America. The partnership between the two companies is expected to unlock over $10 billion in cumulative revenue opportunities.
In conclusion, the acquisition of Core Scientific by CoreWeave marks a significant milestone in the AI and cryptocurrency industries. The combined expertise and resources of the two companies will drive innovation and growth in the rapidly evolving AI landscape.