AI-oriented cloud company CoreWeave said it has reached a deal to buy crypto mining company Core Scientific for about $9 billion ($6.6bn) amidst a larger push by AI companies to secure data centre and energy capacity for power-hungry AI workloads.
CoreWeave stock fell 3 percent on Monday following the news, while Core Scientific’s stock plunged nearly 18 percent. Both firms had seen their stock values rise in recent weeks on anticipation of the acquisition.
Core Scientific previously focused on providing infrastructure for crypto-mining workloads, and filed for bankruptcy in late 2022 following a drop in Bitcoin prices and rising energy costs.
AI data centres
It emerged from bankruptcy in 2024 and relisted on the Nasdaq exchange in the same year while refocusing on the boom in AI demand, in common with several other crypto firms.
CoreWeave has been working with Core Scientific since 2018 and made an unsolicited bid for the company in June 2024, which Core Scientific rejected, saying it was undervalued.
The companies then began signing a series of 12-year contracts under which Core Scientific would provide infrastructure to help power CoreWeave’s high-performance computing (HPC) services.
CoreWeave said buying Core Scientific would help it to immediately eliminate more than $10bn of cumulative future lease overhead to be paid for existing contractual data centre sites over the next 12 years, while significantly enhancing operational efficiency.
The deal gives CoreWeave ownership of 1.3 gigawatts of gross capacity across Core Scientific’s US data centre operations, as well as access to another gigawatt that could power future facilities.
Some 840 megawatts of that power is already allocated to CoreWeave’s contracts at five locations, CoreWeave said on a call with analysts.
Power supply
After the deal closes CoreWeave will be able to either divest Core Scientific’s crypto-mining business, which made up 89 percent of the company’s revenue in the first quarter, or convert it for AI workloads.
CoreWeave chief executive Michael Intrator said the cost of converting cryptocurrency data centre sites is less than constructing new AI data centres.
“This acquisition accelerates our strategy to deploy AI and HPC workloads at scale,” Intrator said in a statement.
CoreWeave held an IPO in March and even with Monday’s share decline was trading at four times its IPO price.
