CoreWeave one of the rising stars in the AI / cloud infrastructure world is facing growing internal resistance to a bold, high-stakes deal. That $5 billion (or more) transaction was supposed to cement its control over data center capacity. Instead, it’s triggering a revolt from major shareholders who say the terms are unfair, undervalued, and increasingly risky.
This isn’t just a boardroom spat. It’s a clash over valuation, control, and how far AI infrastructure firms will go to own their tech stack. For the broader market watching, this could be a warning signal or a reset about how AI expansion should be funded and structured.
In this piece, you’ll get:
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The background and structure of the deal
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The players pushing back who they are and why they oppose
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CoreWeave’s defense and strategic logic
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The key risks and implications
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What to watch in the coming weeks
The Deal at the Center: CoreWeave + Core Scientific
To understand the backlash, first you need to see what the deal is and why CoreWeave is desperate to make it happen.
What the merger is supposed to do
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In July 2025, CoreWeave announced its intention to acquire Core Scientific in an all-stock transaction valued around $9 billion at $20.40 per share.
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Core Scientific supplies significant data center and power infrastructure (formerly with roots in crypto mining) infrastructure that CoreWeave currently leases or partners with. The acquisition is meant to convert those leased assets into owned ones.
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CoreWeave claims that by owning Core Scientific, it can eliminate or reduce billions in lease costs over time something they view as a tailwind for margins and control of scale.
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CoreWeave argues the deal offers synergies, operational efficiencies, vertical integration, and a more stable, predictable cost base.
In essence, this is not just a growth deal; it's meant to reconfigure CoreWeave’s cost structure and ownership of critical assets.
Why the “$5B” figure keeps appearing
Some coverage frames the deal’s meaningful value as closer to $5 billion, likely referring to the portion of cost savings, capital value, or net effective benefit beyond what the all-stock valuation projects. (Many deals are talked about in headline value vs. realized value.)
But the central issue is: as CoreWeave’s own stock price slides and Core Scientific’s valuation rises, the exchange valuation becomes more contentious.
The Investor Revolt: Who’s Pushing Back & Why
This deal isn’t going unchallenged. A growing coalition of Core Scientific shareholders is openly opposing it.
Two Seas Capital: The loudest voice
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Two Seas Capital, a hedge/investment firm and one of the largest active shareholders in Core Scientific (≈6.3 % stake), is publicly urging all shareholders to vote against the deal.
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Their argument: the deal is deeply undervaluing Core Scientific, especially given the upside surge in AI and infrastructure companies. They point out that Core Scientific’s peers (former crypto miners-turned-HPC players) have tripled or more in value since the announcement, while Core Scientific’s own stock has lagged.
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Two Seas contends that shareholders are being asked to convert into volatile and underperforming CoreWeave stock (which has declined ≈15% since the deal was announced), dragging down the implied value.
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Their published investor presentation goes deep into valuation models, arguing that Core Scientific’s standalone prospects, when compared to peers, could justify much higher valuations than what this deal gives.
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They also criticize the process and structure: limited protections, no collars, and heavy exposure to fluctuations in CoreWeave’s stock.
Trip Miller / Gullane Capital: adding to the chorus
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Trip Miller, founder of Gullane Capital (Core Scientific’s third-largest shareholder), recently announced he will vote against under the current structure. He argues that under the math of the current deal, he cannot support it.
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Miller’s stance adds heft it shows dissent isn’t just posturing; real money holders are pulling away.
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His point: in a hot data center market, Core Scientific might be worth far more if left to trade independently estimates he mentions include $30–$40 per share if performance and momentum continue.
Board and leadership defending the deal
In the midst of this pushback, Core Scientific’s board is urging shareholders to vote for the merger:
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The board calls the agreement the “best path forward,” citing cost savings, synergies, risk mitigation, and the difficulty of Core Scientific executing its standalone plan.
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CoreWeave itself has published an open letter to counter what it calls “misleading assertions” from Two Seas, reaffirming that the current offer is best and final and that it will not raise or revise it.
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CoreWeave defends that Core Scientific has limited independent options, especially given that CoreWeave is already its top customer (a high percentage of revenue exposure).
Thus, the battleground is set: shareholders pushing for better terms, and the acquirer refusing to budge all ahead of a decisive vote.
Key Issues at Stake: Valuation, Risk & Control
This fight is less about emotion and more about math, structure, and control. Here are the core issues:
Valuation mismatch & implied discount
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Since the deal was announced, CoreWeave’s stock has declined, reducing the implied value for Core Scientific shareholders when conversion is in all-stock form.
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Meanwhile, peer companies in AI/data center space have surged, highlighting how undervalued Core Scientific may appear in comparison.
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Some shareholders argue the deal’s $20.40/share headline value is outdated, and today the implied value is closer to $17 per share given current stock pricing.
Structural and protection gaps
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The deal is all stock, meaning Core Scientific shareholders’ fate is heavily tied to CoreWeave’s share performance. If CRWV drops further, their effective value falls.
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Critics note the lack of a collar mechanism, which in many M&A deals helps protect shareholders if the acquirer’s stock price declines.
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Some say the negotiation and process lacked sufficient protections or alternates for dissenting shareholders.
Execution & standalone risk
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The independent path for Core Scientific involves large capital expenditures, securing new power contracts, debt or equity raises all risky in a shifting macro environment. Proponents argue the merger eliminates those execution risks.
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But skeptics argue Core Scientific might outperform as a standalone company, especially given rapidly rising demand in AI infrastructure.
Debt, leverage, and balance sheet stress
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CoreWeave is already leveraged. Taking on full ownership of data center infrastructure increases capital burden, maintenance, upgrades, and risk in cycles. Analysts have flagged this shift in business model as moving CoreWeave from light infrastructure to heavy capex burdens.
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Any underperformance or cost overrun could magnify downside.
Signaling & control
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A failed deal or massive dissent would send a negative signal to markets: that even core infrastructure consolidation in the AI sector is contested and uncertain.
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The vote outcome influences who holds control, board rights, governance, and strategic direction in the combined entity.
What Happens Next Scenarios to Watch
How this plays out depends on several variables. The key moments and scenarios:
The shareholder vote (October 30, 2025)
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All eyes are on this vote. If enough shares block the deal, it might be killed or renegotiated.
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If it passes narrowly, CoreWeave may need to reassure dissenters with side agreements or concessions.
Potential deal amendments or enhancements
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Though CoreWeave says it won’t budge, pressure might force it to consider price bump, collars, escrow, or earn-outs to placate detractors.
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They may introduce protective mechanisms for Core Scientific shareholders to reduce downside.
Market reaction & valuation shifts
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If markets perceive the vote or backlash as weakening CoreWeave’s command, its stock might suffer further.
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Conversely, if the vote passes and integration begins smoothly, value capture in cost savings might win over skeptics.
Integration risks & execution
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Consolidating operations, integrating systems, absorbing maintenance and capex responsibilities any misstep could erode promised savings.
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Energy, power contracts, scaling infrastructure, customer retention these operational fronts will be tested.
Long-term precedent in AI infrastructure deals
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This case may set a bar for how aggressive or fair future buyouts in AI / cloud infrastructure should be.
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Deals might trend toward hybrid (cash + stock) or heavier downside protections for the acquired party.
Why It Matters (Beyond These Two Companies)
This isn’t just a fight between CoreWeave and Core Scientific. It holds lessons and signals for the broader AI, cloud, and infrastructure space:
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Infrastructure ownership vs leasing: Many AI firms debate whether to rent data center capacity or own it. This deal is a big bet on owning.
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Investor expectations vs hype: The AI infrastructure space is hot, but valuations, risks, and expectations must align or dissent will emerge.
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Deal structure matters: In high-growth sectors, stock-based mergers are risky protection clauses, collars, governance rights become vital.
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Power and capital intensity: Owning infrastructure means exposure to power costs, capital cycles, debt, and hardware obsolescence.
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Watchdog activism: Shareholders are no longer passive; institutional investors will push back if deals don’t reflect value or protections.
That $5-billion figure was always more than a headline. It represents a bet a bet that CoreWeave can integrate, scale, and harness infrastructure control to dominate AI cloud services. But the backlash shows that even in the AI gold rush, deals must meet the test of fairness, structure, and resilience.
As of now, the vote is coming. The market is watching whether growth ambitions trump dissent, or whether shareholders demand a better deal. If this deal falls apart or ends up contentious it could slow consolidation in AI infrastructure or force more cautious dealmaking in this space.
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