DEFM14A: Core Scientific to Merge with CoreWeave in All-Stock Deal

Core Scientific's board unanimously recommends an all-stock merger with AI hyperscaler CoreWeave, offering stockholders a 27.2% premium and a stake in a rapidly growing AI infrastructure leader.

Summary

• Core Scientific, Inc. will merge with Miami Merger Sub I, Inc., a wholly-owned subsidiary of CoreWeave, Inc., with Core Scientific continuing as the surviving, wholly-owned subsidiary.
• Each share of Core Scientific common stock will be converted into the right to receive 0.1235 shares of CoreWeave Class A common stock, with cash paid in lieu of fractional shares.
• The implied value of the merger consideration was $20.40 per Core Scientific share based on CoreWeave's July 3, 2025 closing price of $165.20, representing a 65.9% premium over Core Scientific's unaffected June 25, 2025 closing price of $12.30.
• As of September 25, 2025, the implied value was $15.64 per Core Scientific share, based on CoreWeave's closing price of $126.66.
• Core Scientific stockholders are expected to own approximately 9.4% of the combined company's outstanding CoreWeave common stock.
• The Core Scientific board unanimously approved the merger and recommends stockholders vote FOR the adoption of the Merger Agreement and the non-binding advisory compensation proposal.
• The merger is expected to close in the fourth quarter of 2025.
• Two Seas Capital LP is actively soliciting proxies to vote against the merger and the advisory compensation proposal.

Sentiment

Score: 8

Explanation: The merger offers a significant premium to Core Scientific stockholders and integrates Core Scientific's infrastructure into CoreWeave's rapidly growing AI cloud platform, creating substantial synergies and de-risking Core Scientific's standalone business plan. CoreWeave is aggressively expanding its capacity and market presence, backed by substantial financing, positioning the combined entity for strong future growth in the high-demand AI sector.

Positives

• Core Scientific stockholders receive a significant premium of 27.2% over the unaffected closing price of $12.30 on June 25, 2025, and 65.9% based on the July 3, 2025 implied value of $20.40.
• Stockholders gain an ownership stake (approximately 9.4%) in CoreWeave, a rapidly growing AI hyperscaler, allowing participation in future growth and synergies.
• The merger combines Core Scientific's data center development and operations team with CoreWeave's engineering expertise, enabling direct control over next-generation build designs and improved delivery timelines.
• Expected cash savings from CoreWeave internalizing leasing obligations to Core Scientific, leading to an improved credit profile, increased borrowing capacity, reduced cost of capital, and enhanced liquidity for the combined entity.
• The transaction is intended to qualify as a tax-free reorganization for U.S. federal income tax purposes, generally allowing U.S. holders to avoid immediate gain or loss recognition (except for fractional shares).
• CoreWeave common stock, New Tranche 1 Warrants, and New Tranche 2 Warrants will be listed on Nasdaq, ensuring continued liquidity.
• The Core Scientific board concluded the merger is the best available strategic alternative, especially given the challenges and risks of Core Scientific's standalone plan.

Negatives

• The fixed exchange ratio means Core Scientific stockholders bear the risk of a decrease in CoreWeave's stock price, with no collar or value-based termination right to protect against this.
• The expiration of CoreWeave's IPO-related lock-up restrictions on August 14, 2025, could lead to increased selling pressure and a decline in CoreWeave's stock price.
• Core Scientific is obligated to pay a $270 million termination fee to CoreWeave under certain circumstances, which could be a significant cost if the merger fails.
• Interim operating covenants restrict Core Scientific's business activities during the pendency of the merger, potentially limiting its ability to pursue new opportunities.
• Core Scientific stockholders will have a significantly lower ownership and voting interest in the combined company, and CoreWeave's multi-class stock structure concentrates voting power with its co-founders.
• The potential repurposing or divestiture of Core Scientific's digital asset mining businesses (which accounted for 95% of 2024 revenue and 86.5% of Q2 2025 revenue) could significantly alter the combined company's revenue streams.
• Revenue generated by Core Scientific from providing HPC hosting services to CoreWeave will cease upon completion of the merger, impacting Core Scientific's historical revenue contribution.

Risks

• The value of the merger consideration is subject to fluctuations in CoreWeave's stock price, and Core Scientific stockholders are not entitled to appraisal rights under Delaware law.
• CoreWeave's business relationships or those of Core Scientific may be disrupted due to uncertainty associated with the merger, potentially leading to contract terminations or alterations by third parties.
• Both Core Scientific and CoreWeave are subject to restrictions on their business activities during the pre-closing period, which could hinder strategic opportunities or responses to competitive pressures.
• Completion of the merger is subject to various conditions, including stockholder and regulatory approvals, which may not be satisfied or waived in a timely manner, or at all, potentially delaying or preventing the merger.
• There is a risk that the combined company may fail to realize the anticipated benefits and synergies of the merger, or that integration efforts could be more difficult or costly than expected.
• CoreWeave's historical financials may not be indicative of future performance, especially given the potential repurposing or divestiture of Core Scientific's digital asset mining businesses and the cessation of intercompany HPC hosting revenue.
• The unaudited pro forma condensed combined financial information is preliminary and the actual financial condition and results of operations of the combined company may differ materially.
• Financial forecasts are based on various assumptions that may not be realized, and financial advisor opinions may not reflect changes in circumstances.
• The merger may trigger change-in-control provisions in Core Scientific's existing agreements, potentially leading to terminations or financial penalties.
• Certain Core Scientific executive officers and directors have interests in the merger that differ from general stockholders, including accelerated equity vesting, severance payments, and excise tax reimbursements.
• Failure to complete the merger could negatively impact the stock price and future business and financial results of both Core Scientific and CoreWeave.
• Core Scientific stockholders will experience significant dilution and reduced voting influence in CoreWeave, particularly due to CoreWeave's multi-class stock structure concentrating voting power with its co-founders.
• Potential litigation challenging the merger could result in substantial costs, injunctions, or damages.
• The issuance of new CoreWeave shares and warrants will increase the number of shares eligible for future resale, potentially adversely affecting CoreWeave's market price.
• CoreWeave faces risks related to managing rapid growth, limited suppliers (e.g., NVIDIA GPUs), access to sufficient power, data center reliability, customer concentration (e.g., Microsoft, OpenAI), and rapidly changing AI technology and regulatory frameworks.
• CoreWeave's substantial indebtedness and capital expenditure requirements pose financial risks, and its ability to lower its cost of capital depends on external factors.
• CoreWeave has identified material weaknesses in its internal control over financial reporting, which could impair its ability to produce timely and accurate financial statements if not effectively remediated.
• CoreWeave is exposed to various legal and regulatory risks, including export/import controls, sanctions, anti-corruption laws, data privacy laws (e.g., GDPR, CCPA), and increasing scrutiny on AI and cloud services.
• CoreWeave's business is subject to adverse global macroeconomic conditions, geopolitical risks (e.g., Middle East, Ukraine, China-Taiwan), natural disasters, and other catastrophic events.
• CoreWeave does not intend to pay dividends in the foreseeable future, meaning stockholder returns depend on stock price appreciation.
• Provisions in CoreWeave's charter documents and Delaware law could make an acquisition of CoreWeave more difficult and limit stockholder influence.
• Exclusive forum provisions may limit stockholders' ability to obtain favorable judicial forum.
• Future issuance of Class C common stock may further concentrate voting control.
• Core Scientific is subject to its own business risks as detailed in its SEC filings, which will become risks of the combined company.

Future Outlook

CoreWeave expects its revenue growth rate to decline in the future as its business matures, while operating expenses are anticipated to increase due to public company costs and continued investments in R&D. The company plans to maintain its focus on attracting and expanding relationships with leading AI labs and enterprises, expecting continued rapid growth in demanding inference workloads and broader enterprise adoption of AI. CoreWeave intends to expand its international presence with significant investments in Europe and increase vertical integration by enhancing its software offerings and data center capabilities, including potentially acquiring direct ownership stakes in data centers. The company also aims to maximize the economic life of its infrastructure by monetizing components from expired contracts. CoreWeave expects to continue incurring indebtedness and anticipates a declining cost of capital, but acknowledges that its ability to achieve this depends on broader macroeconomic conditions. CoreWeave may repurpose or divest Core Scientific's digital asset mining businesses over the medium-term, which accounted for a significant portion of Core Scientific's historical revenue.

Management Comments

• Adam Sullivan (Core Scientific CEO): "Your vote is very important regardless of the number of shares of Core Scientific common stock that you own."
• Adam Sullivan (Core Scientific CEO): "The Core Scientific board has unanimously approved the Merger Agreement and recommends that Core Scientifics stockholders vote in favor of adopting the Merger Agreement."
• Adam Sullivan (Core Scientific CEO): "We urge you to read this proxy statement/prospectus and the annexes and documents incorporated by reference carefully. You should also carefully consider the risks that are described in the Risk Factors section beginning on page 28."
• Adam Sullivan (Core Scientific CEO): "The Core Scientific board unanimously recommends that Core Scientific stockholders vote FOR the proposal to adopt the Merger Agreement and FOR the proposal to approve, on a non-binding advisory basis, the compensation that may be paid or become payable to Core Scientifics named executive officers that is based on or otherwise related to the Merger."
• Ben Firshman (CEO at Replicate, CoreWeave customer): "CoreWeave is our key cloud provider and has been instrumental in enabling our demanding inference workloads to scale seamlessly. CoreWeave has delivered high performance, resilience, and reliability that directly enables us to allow our customers to access and fine tune some of the best AI models on the market with minimal friction."
• Craig Falls (Head of Quant Research, Jane Street, CoreWeave customer and investor): "We decided on CoreWeave as our high-performance cloud provider after we saw how fast the CoreWeave team moved and got Hopper online first. We needed access to the latest cutting-edge hardware quickly, and we trusted CoreWeave to deliver it faster than any other provider. CoreWeaves resilient, high-performance compute infrastructure is fundamental to allowing us to build quickly, as CoreWeave delivered a reliable cluster that could withstand our intense training requirements. CoreWeaves deep technical capabilities and extensive scalability have been instrumental in pushing the boundaries of whats possible in algorithmic trading."
• Arthur Mensch (CEO and Co-Founder at Mistral AI, CoreWeave customer): "CoreWeaves Mission Control has been transformative for our infrastructure, unlocking higher cluster performance and dramatically accelerating our time to market. CoreWeaves intelligent lifecycle management and optimization tools and robust support solutions, have been critical in our journey to becoming an industry-leading AI model developer."

Industry Context

The filing highlights that AI is the next major technological revolution, expected to add nearly $20 trillion to global GDP by 2030, driving significant productivity gains and new business models. The market for AI compute software and infrastructure is projected to grow at a 38% CAGR from $79 billion in 2023 to $399 billion by 2028. This growth is fueled by advancements in AI models, increasing data volumes, and the need for specialized, high-performance compute infrastructure. CoreWeave positions itself as an 'AI Hyperscaler' purpose-built to address the unique demands of AI workloads, contrasting with generalized cloud providers. The industry faces challenges in building and operating complex AI infrastructure at scale, maximizing GPU utilization (MFU efficiency gap), and responding to rapidly evolving technology and regulatory frameworks. Increasing regulatory scrutiny on market concentration and anti-competitive practices in AI and cloud services, along with geopolitical risks impacting the semiconductor supply chain, are noted as significant industry trends.

Comparison to Industry Standards

• CoreWeave's NVIDIA H100 Tensor Core GPU training cluster completed the MLPerf benchmark test in 11 minutes, a record and 29 times faster than the next best competitor at the time of the 2023 benchmark test.
• CoreWeave delivered the largest-ever MLPerf Training v5.0 submission on NVIDIA Blackwell, using 2,496 NVIDIA Blackwell GPUs, achieving approximately 4.5 times faster training performance than the best submission from another organization's GB200 cluster, and 2 times faster than similar cluster sizes using prior generation hardware.
• CoreWeave's CoreWeave Cloud Platform offers up to approximately 20% improvement in system MFU (Measured FLOPs Utilization) over comparative benchmark MFU performance, minimizing the efficiency gap between observed and theoretical maximum GPU cluster performance.
• CoreWeave has a track record of being among the first to market with cutting-edge infrastructure technology, including NVIDIA H100, H200, GH200 clusters, the first to deliver GB200 clusters into production at scale, and the first cloud provider with an initial deployment of NVIDIA GB300 NVL72-based systems.
• CoreWeave can deploy the newest chips and provide compute capacity to customers in as little as two weeks from receipt from OEM partners such as Dell and Super Micro.
• CoreWeave's $28.6 billion in debt and equity funding commitments represent a scale not achieved by other established players or new entrants in the AI cloud space.
• The DDTL 3.0 Facility was financed at SOFR +4%, a 9% decrease from CoreWeave's DDTL 2.0 Facility, demonstrating progress in reducing its cost of capital.

Management Changes

Corporate Governance

Legal Proceedings

• No pending lawsuits directly challenging the Merger as of the filing date.
• Core Scientific has received letters from purported stockholders contending that the Form S-4 registration statement (of which this proxy statement is a part) fails to disclose certain allegedly material information and demanding supplemental disclosures.
• Core Scientific believes these contentions are without merit and are at a preliminary stage, but acknowledges the possibility of additional complaints.
• Litigation is inherently uncertain, and there is no assurance regarding the likelihood of successful defense or predictability of time and expense required to resolve potential lawsuits.

Related Party Transactions

• Core Scientific and CoreWeave have had an ongoing commercial relationship since 2019, evolving from digital asset mining hosting to long-term HPC infrastructure contracts (including 16 MW in Austin, ~200 MW additional, 70 MW additional, 112 MW additional, 120 MW additional, and 70 MW in Denton).
• In CoreWeave's 2024 Tender Offer, funds affiliated with CoreWeave director Glenn Hutchins purchased 212,780 Class A shares for $9,999,097, while CoreWeave co-founders (Michael Intrator, Brian Venturo, Brannin McBee), Kristen McVeety (General Counsel), and Jack Cogen (director) and their affiliates sold shares.
• In CoreWeave's 2023 Tender Offer, CoreWeave co-founders (Michael Intrator, Brian Venturo, Brannin McBee), Kristen McVeety, and Jack Cogen and their affiliates sold shares.
• In April 2023, Michael Intrator and Jack Cogen (and affiliates) acquired shares in CoreWeave's Series B-1 Convertible Preferred Stock Financing.
• In September 2024, CoreWeave entered into Equity Exchange Right Agreements with its co-founders (Michael Intrator, Brian Venturo, Brannin McBee), granting them the right to exchange Class A shares from equity awards for Class B shares.
• Michael McBee, brother of CoreWeave Chief Development Officer Brannin McBee, has been employed by CoreWeave in a non-executive role since November 2024 with an annual base salary of $190,000.
• CoreWeave's Third Amended and Restated Investors Rights Agreement grants registration rights to certain holders, including affiliates of Jack Cogen, Michael Intrator, and Brian Venturo.
• CoreWeave's Voting Agreement, which included Jack Cogen, Michael Intrator, Brian Venturo, and Brannin McBee affiliates as parties, was terminated upon CoreWeave's IPO.
• CoreWeave has entered into indemnification agreements with its executive officers and directors.
• CoreWeave's 2021 Convertible Senior Secured Notes were issued to funds managed or advised by Magnetar Financial LLC (a related party), including an option for Magnetar to purchase CoreWeave Class A common stock.
• CoreWeave's 2022 Senior Secured Notes were issued to funds managed or advised by Magnetar Financial LLC, along with warrants, and were redeemed in July 2024.
• CoreWeave's DDTL 1.0 Facility included $520 million from funds managed or advised by Magnetar Financial LLC.
• CoreWeave's DDTL 2.0 Facility included $210 million from funds managed or advised by Magnetar Financial LLC.
• CoreWeave received a $230 million refundable deposit from MagAI Ventures (a fund managed by Magnetar) for cloud computing services, which was reclassified as debt (Magnetar Loan) in February 2025.
• In June 2024, CoreWeave contributed $50 million to a fund managed by Magnetar as a strategic investment.
• In June 2025, CoreWeave entered into an unconsolidated joint venture with a third-party infrastructure developer for a data center campus in Kenilworth, New Jersey.

Stakeholder Impact

• **Shareholders (Core Scientific)**: Will receive CoreWeave common stock, gaining exposure to a larger, more diversified AI cloud platform with significant growth potential, and a substantial premium over the unaffected share price. However, they will experience dilution and lose direct control over Core Scientific, with no appraisal rights. The fixed exchange ratio exposes them to CoreWeave stock price fluctuations.
• **Shareholders (CoreWeave)**: Will see their ownership percentage diluted by the issuance of new shares to Core Scientific stockholders. Their voting power remains concentrated with co-founders due to the multi-class structure, potentially limiting influence of other stockholders.
• **Employees (Core Scientific)**: Face uncertainty regarding future roles but are offered retention provisions and, for executive officers, severance benefits and accelerated equity vesting. The combined entity aims to leverage Core Scientific's talent and expertise.
• **Customers (Core Scientific)**: Will transition to being customers of the combined CoreWeave entity, potentially benefiting from enhanced AI/HPC capabilities and a broader platform. Existing contracts may be subject to disruption or require consents.
• **Customers (CoreWeave)**: Will benefit from expanded infrastructure, enhanced operational efficiency, and accelerated deployment of AI/HPC workloads due to the integration of Core Scientific's assets and expertise.
• **Suppliers**: Relationships may be impacted by the change in ownership and potential consolidation of procurement. CoreWeave aims to strengthen its supply chain relationships.
• **Creditors**: CoreWeave's substantial existing debt and its strategy to leverage diverse financing structures will be critical. Core Scientific's indebtedness will be addressed in the merger, potentially impacting existing debt holders.
• **Regulatory Bodies**: The merger is subject to antitrust review and other regulatory approvals, which could impose conditions or delays, affecting the combined entity's operations and market position.

Next Steps

• Core Scientific stockholders are to vote on the Merger Agreement Proposal and the Advisory Compensation Proposal at a Special Meeting on October 30, 2025.
• CoreWeave and Core Scientific will continue efforts to satisfy closing conditions, including obtaining all necessary regulatory approvals.
• Post-merger, CoreWeave plans to integrate Core Scientific's operations to accelerate AI and HPC workload deployment.
• CoreWeave will continue to invest in its product and engineering teams to extend its technology leadership and software offerings.
• CoreWeave aims to capture additional workloads from existing customers and expand into broader enterprise markets and new industries.
• CoreWeave plans further international expansion, including a $2.2 billion investment in Spain and Sweden and launch in Norway by the end of 2025, and a $1.5 billion investment in UK AI data center capacity.
• CoreWeave intends to increase vertical integration by enhancing its software stack and potentially acquiring direct ownership stakes in data centers.
• CoreWeave will work to maximize the economic life of its infrastructure by monetizing components from expired contracts.
• CoreWeave's remediation efforts for identified material weaknesses in internal control over financial reporting are expected to continue into 2026.
• CoreWeave will be required to provide a management report on internal control over financial reporting starting with its annual report on Form 10-K for the year ending December 31, 2026.
• CoreWeave will evaluate and reflect changes required to its financial statements due to the One Big Beautiful Bill Act (OBBBA) in its Quarterly Report on Form 10-Q for the three and nine months ending September 30, 2025.
• Core Scientific will cooperate with CoreWeave in causing the delisting of Core Scientific common stock and warrants from Nasdaq and deregistration under the Exchange Act.

Key Dates

Recommendation

The Core Scientific board unanimously recommends the merger, citing a significant premium (65.9% over unaffected price) for its stockholders and the opportunity to participate in CoreWeave's rapidly growing AI cloud platform. The merger addresses Core Scientific's standalone risks related to capital expenditures and customer acquisition. CoreWeave is positioned as a leader in AI cloud infrastructure with strong growth, strategic partnerships, and a robust financing strategy, making the combined entity a compelling investment in the high-growth AI sector. While the fixed exchange ratio introduces market risk, the substantial initial premium and strategic benefits of joining a larger, more diversified, and well-funded AI hyperscaler outweigh these concerns for a seasoned investor.

Keywords

Merger, Acquisition, AI Hyperscaler, Cloud Computing, Data Center, CoreWeave, Core Scientific, HPC, Artificial Intelligence, GPU, Nasdaq, Stock-for-Stock, Corporate Governance, Risk Management, Financial Analysis