CoreWeave’s audacious all-stock bid to acquire Bitcoin miner Core Scientific has set the cryptocurrency world abuzz this week. Valued at $20.40 per share, this deal translates to roughly a 16x FY26E EBITDA multiple—an eyebrow-raising figure when compared to traditional data center peers. Core Scientific’s stock took a nosedive, shedding 18% to hover around $14.75, while CoreWeave’s shares also stumbled, dipping 5%.
A Deal Shrouded in Speculation
The proposed acquisition comes as no surprise to those following CoreWeave’s market maneuvers. The company’s shares have soared 295% post-IPO, providing a tantalizing backdrop for this bold move. According to KBW, this transaction could be a strategic coup for CoreWeave, potentially slashing over $10 billion in lease obligations and unlocking upwards of $500 million in annual cost savings by 2027. Yet, some investors are seemingly skeptical.
“While this is an opportunistic attempt by CRWV to capitalize on recent stock appreciation, the market reaction hints at underlying disappointment and potential contention over the terms,” remarked KBW analyst Bill Papanastasiou. Indeed, the deal’s structure—a completely stock-based exchange—has left some shareholders less than enthused. This follows a pattern of institutional adoption, which we detailed in our analysis of corporate treasury investments.
Shareholder Showdown Looms
Under the agreement’s terms, Core Scientific shareholders are to receive 0.1235 CoreWeave shares for each of their own, pegging the miner’s valuation at about $9 billion. However, approval from Core Scientific’s stakeholders is still pending and could prove contentious. “The unchanged asset base since CRWV’s initial unsuccessful bid and the absence of a cash component may lead to friction during the shareholder vote,” Papanastasiou added.
Despite the expected resistance, the pathway seems relatively clear for CoreWeave, as no rival offers are anticipated. The deal is slated to reach completion in the fourth quarter of this year. Meanwhile, KBW maintains an “outperform” stance on Core Scientific shares, setting a $19 price target.
Industry Reactions and Implications
The broader market has not been silent on the matter. Rival investment firm Bernstein also weighed in, noting the plummet in Core Scientific’s stock post-announcement. “Shareholders were probably expecting a higher valuation,” the firm stated, underscoring investor discontent with the all-stock proposition. Bernstein, too, holds an “outperform” rating on Core Scientific but has adjusted its price objective to $17.
While the immediate reaction from the market appears tepid, the long-term implications of this merger could be significant. Should the acquisition proceed without hiccups, CoreWeave stands to significantly bolster its position in the data center space, potentially reshaping the landscape for crypto mining operations. This strategic maneuver echoes recent developments where Crypto Market Maker Wintermute snags a Bitcoin credit line from Cantor Fitzgerald, highlighting the ongoing evolution within the industry.
The Road Ahead
As we await the shareholder vote, questions linger about the deal’s potential to reshape industry dynamics. Will the strategic gains for CoreWeave outweigh the immediate market skepticism? And how will this play into the larger narrative of consolidation within the cryptocurrency sector?
As the fourth quarter approaches, eyes will remain on CoreWeave and Core Scientific as they navigate this pivotal juncture. The outcome will not only impact shareholders but could also set a precedent for future mergers and acquisitions in an industry that’s no stranger to volatility and rapid change.
Source
This article is based on: CoreWeave’s All-Stock Bid for Core Scientific Likely to Draw Shareholder Scrutiny: KBW
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Steve Gregory is a lawyer in the United States who specializes in licensing for cryptocurrency companies and products. Steve began his career as an attorney in 2015 but made the switch to working in cryptocurrency full time shortly after joining the original team at Gemini Trust Company, an early cryptocurrency exchange based in New York City. Steve then joined CEX.io and was able to launch their regulated US-based cryptocurrency. Steve then went on to become the CEO at currency.com when he ran for four years and was able to lead currency.com to being fully acquired in 2025.
