CoreWeave is paying $9 billion (€7.7 billion) for the acquisition of Core Scientific. The deal doubles the company’s AI data center capacity, strengthening its position as a GPU-as-a-Service provider. The transaction will be completed by the end of 2025.
Cloud infrastructure providers are building new data centers on an unprecedented scale to meet AI demand. The demand for computing power for AI applications currently exceeds supply, enabling companies such as CoreWeave to grow rapidly.
Core Scientific began as a bitcoin miner but, like other cryptocurrency companies, is now seeking to capitalize on the growing demand for AI data center capacity. The company has approximately 1.3 gigawatts of power capacity. By way of comparison, that is comparable to a single nuclear reactor and enough to power 750,000 households.
Premium of 66 percent
The acquisition values Core Scientific at $20.40 per share. That represents a premium of 66 percent over the share price on June 25, the day before the Wall Street Journal reported on the talks. Core Scientific shareholders will own less than 10 percent of the combined company after the transaction.
CoreWeave CEO Michael Intrator sees the acquisition as accelerating the company’s strategy. “This acquisition accelerates our strategy to deploy AI and HPC workloads at scale,” he said. HPC stands for high-powered computing, the technology required for intensive AI applications.
Existing collaboration
The two companies have been working together since last year. CoreWeave initially offered $1 billion for Core Scientific, but has now made a much higher bid. At the same time, they signed 12-year contracts in which Core Scientific will provide 200 megawatts of infrastructure for CoreWeave’s operations.
CoreWeave positions itself as a GPU-as-a-Service provider and recently signed an $11.9 billion contract with OpenAI. The company offers specialized GPU clusters for AI training and inference, which is attractive to companies that do not want to maintain their own hardware.
Market reaction
Stock prices reacted negatively to the news. CoreWeave fell 4.4 percent in pre-market trading, while Core Scientific dropped 14 percent. Investors appear concerned about the high acquisition price and the integration of two different corporate cultures.
With this acquisition, CoreWeave doubles its energy capacity and strengthens its position in the highly competitive AI data center market. The deal shows how former crypto companies can successfully reposition themselves in the AI economy.