CoreWeave to Acquire Core Scientific in $9 Billion Deal, Bitcoin Mining Stocks Tumble 5% to 10%

CoreWeave, an artificial intelligence hyperscaler, has agreed to acquire Core Scientific, a Bitcoin miner and data center infrastructure provider, in an all-stock deal valued at approximately $9 billion. The acquisition, announced on Monday, has sent shockwaves through the Bitcoin mining sector, with stocks of major players such as MARA Holdings, Riot Platforms, CleanSpark, and Cipher Mining tumbling between 5% and 10%.

Core Scientific's stock price fell by over 19%, while CoreWeave's stock dropped by more than 4% following the announcement. The decline in Core Scientific's stock price created a ripple effect, impacting other crypto mining stocks. MARA Holdings saw a drop of over 6%, Riot Platforms fell by 5.91%, CleanSpark decreased by 7.43%, and Cipher Mining tumbled by 7.59%. TeraWulf also experienced a significant decline, with its stock price plunging by more than 10%.

Investor skepticism about the immediate financial impacts of the deal contributed to the stock declines. Since the transaction is all-stock, any decrease in CoreWeave's stock price directly affects the perceived value for Core Scientific shareholders, potentially leading to further selling. CoreWeave CEO Michael Intrator highlighted that the acquisition will eliminate $10 billion in future lease obligations and significantly enhance operating efficiency. The deal is expected to close in the fourth quarter of this year, subject to customary closing conditions, including regulatory approval and approval by Core Scientific stockholders.

Under the terms of the merger agreement, Core Scientific stockholders will receive 0.1235 newly issued shares of CoreWeave Class A common stock for each share of Core Scientific common stock. This represents a $20.40 per share value based on the closing price of CoreWeave Class A common stock as of July 3, and a premium of approximately 66% to the unaffected Core Scientific closing share price of $12.30 on June 25. CoreWeave aims to verticalize its data center footprint to future-proof revenue growth and enhance profitability. The company seeks to accelerate its strategy to deploy AI and high-performance computing (HPC) workloads at scale, addressing the rising demand for AI and growth in the industry.