Image Credits:CoreWeave <\/p>\n
Core Scientific shareholders on Thursday voted down<\/a> an all-stock acquisition offer from partner and competitor CoreWeave that was valued at the time at $9 billion. <\/p>\n They did so following a vote-no recommendation from their largest shareholder, Sina Toussi of Two Seas Capital, a firm that focuses on post-bankruptcy companies.\u00a0Core Scientific emerged from its bankruptcy<\/a> in January 2024. <\/p>\n Core Scientific, which began as a crypto miner and still is one, shares that early history with AI data center provider CoreWeave, which also started as a miner. <\/a><\/p>\n But CoreWeave, with investor and partner Nvidia<\/a>, has now transitioned to serving AI workloads. From its IPO until now, its stock has soared from a $14 billion market cap to $66 billion today (about $140 per share) as investors view it as a way to get in on the AI action. It has been spending those shares on acquisitions. <\/p>\n CoreWeave had already signed a $10 billion, 12-year contract with Core Scientific to use its facilities for AI services, even as it nailed down a deal announced in July to buy the company outright. The offer was a premium to Core Scientific\u2019s share price at the time.<\/p>\n But investor Toussi thinks Core Scientific can turn into another CoreWeave on its own. \u201cSince the transaction was announced in July, investment in AI infrastructure has accelerated, driving equity valuations of Core Scientific\u2019s peers to ever-greater heights,\u201d he wrote in his opposition letter<\/a>. \u201cWhy would anyone vote for a transaction worth a mere $16.40 per share?\u201d<\/p>\n So investors turned down the deal and CoreWeave walked. Core Scientific\u2019s stock rose on the news, and the company is now trading at a $6.6 billion market cap.<\/p>\n Investors turning down acquisition bids in pursuit of bigger offers is another sign that we\u2019re in \u2013 or at least headed for \u2013 an AI bubble.<\/p>\n