CoreWeave CEO on Core Scientific deal amid growing shareholder opposition

CoreWeave CEO Michael Intrater told CNBC on Tuesday that the firm’s proposed acquisition Core Scientist It would be a “better to have” than a necessity as shareholders potentially prepare to block the deal.

In July, AI cloud provider Coreweave proposed an all-stock deal It is worth about $9 billion To buy Bitcoin miner and data center firm, Core Scientific. Immediately following the news, Core Scientific’s stock price fell nearly 18%.

Institutional Shareholder Services (ISS), the leading proxy adviser on the deal, recommended on Monday that shareholders vote against the acquisition. Core Scientific’s share price continued to rise after the deal was announced, leading some investors to believe the company is worth more than what CoreWeave has to offer, ISS said.

Intrater said he was “disappointed” by the ISS report and believed the deal was “in the long-term interest of core scientific stakeholders.” However, CoreWeave will not increase the price of the offer.

“We think the bid we made for (Core Scientific) is a fair representation of the relative value of the two companies as an all stock deal,” Intrater told CNBC. “We’re moving forward as we have, if the transaction doesn’t go through. It’s a nice to have, not a must have for us.”

“Everything has a value and the number we put in is the value we’re willing to pay for them under all circumstances,” Intrater added.

Earlier this month, Two Seas Capital, a major Core Scientific shareholder, publicly opposed the acquisition, saying the price offered by CoreWeave was too low. Shareholders will vote on the deal on October 30.

“We see no reason why Core Scientific shareholders should accept such an underwhelming deal. Based on recent trading data, we see little evidence that they will,” Two Seas Capital said in a letter to shareholders on Friday.

CoreWeave has aggressively acquired AI-related companies such as OpenPipe, Weights & Biases and Monolith this year as it looks to expand its product offering.

The company, which built data centers and offers Nvidia-The computing power that powers hyperscalers like Microsoft is riding a wave of artificial intelligence investment.

“We are in acquisition mode as we continue to build and grow our company’s capabilities,” Intrater said.