Core Scientific Acquisition Faces Shareholder Revolt as AI Infrastructure Values Soar

Major Proxy Advisor Urges Rejection of CoreWeave’s $9 Billion Takeover Bid

The proposed acquisition of Core Scientific by AI cloud provider CoreWeave has hit significant turbulence, with influential proxy advisory firm Institutional Shareholder Services (ISS) recommending that shareholders vote against the $9 billion deal. This development signals potential cracks in the recent frenzy of data center mergers and acquisitions, particularly as artificial intelligence infrastructure continues to appreciate rapidly in value.

Major Proxy Advisor Urges Rejection of CoreWeave’s $9 Billion Takeover Bid
Growing Shareholder Resistance Emerges
The AI Infrastructure Gold Rush Context
What This Means for Future Data Center M&A
Broader Implications for AI Infrastructure Market

Growing Shareholder Resistance Emerges

Two Seas Capital, an alternative investment management firm and one of Core Scientific’s largest shareholders, quickly endorsed ISS’s position. The firm’s founder and chief investment officer, Sina Toussi, emphasized in a public statement that “since the proposed merger was announced, unprecedented investment in the AI infrastructure build-out has continued, with companies announcing significant HPC hosting and other similar agreements seemingly every week.”

This shareholder resistance highlights the challenging valuation environment for AI infrastructure assets. As companies race to build out high-performance computing capabilities, the perceived value of established data center operators like Core Scientific appears to be increasing faster than acquisition terms can be adjusted.

The AI Infrastructure Gold Rush Context

The current situation reflects broader market dynamics where AI infrastructure assets have become increasingly strategic and valuable. Core Scientific, originally known for bitcoin mining operations, has successfully pivoted to providing high-performance computing infrastructure for AI workloads. This transition positioned the company as an attractive acquisition target during the ongoing AI boom.

However, the rapid pace of AI infrastructure development has created a moving target for valuation. What might have seemed like a generous offer in July now appears potentially undervalued as new investments and partnerships continue to emerge across the sector.

What This Means for Future Data Center M&A

The resistance to this acquisition could signal several important trends:

Valuation challenges in fast-moving technology sectors where asset values can change rapidly
Increased shareholder activism in technology infrastructure deals
Potential peak in data center M&A activity as buyers and sellers struggle to agree on appropriate valuations
Growing recognition of strategic value of AI infrastructure assets beyond immediate financial metrics

Broader Implications for AI Infrastructure Market

This acquisition struggle occurs against the backdrop of massive AI infrastructure investment across the technology sector. Major cloud providers, specialized AI companies, and traditional enterprises are all racing to secure computing capacity for training and running increasingly sophisticated AI models.

The Core Scientific situation demonstrates how quickly market conditions can change in the AI sector and how challenging it can be to execute large-scale acquisitions when underlying asset values are appreciating rapidly. As ISS’s detailed recommendation highlights, shareholders are becoming increasingly sophisticated about the long-term value of AI infrastructure assets and are willing to challenge deals they believe don’t reflect current market conditions., as additional insights

The final outcome of this acquisition battle will likely influence how future AI infrastructure deals are structured and valued, potentially leading to more creative deal structures that can accommodate the rapid appreciation of assets in this dynamic sector., according to additional coverage