Shareholders Reject All-Stock Merger, Support Core Scientific's Shift to AI

Shares of Core Scientific (CORZ) rose by 5% on October 30 after shareholders rejected a proposed $9 billion all-stock merger with AI infrastructure company

(CRWV). The deal, which had encountered increasing resistance from key investors and proxy advisory firms, was called off after the vote failed, causing CoreWeave’s shares to drop nearly 6% in early trading, as reported by . This decision marks a significant turning point for , which has shifted its focus from mining to AI infrastructure, sparking debate among shareholders and analysts about the company’s prospects as an independent entity.

The merger, first announced in July, would have allowed Core Scientific shareholders to receive 0.1235 CoreWeave Class A shares for each of their shares, valuing the combined company at $9 billion. Critics, however, argued that the all-stock nature of the deal left Core Scientific investors vulnerable to fluctuations in CoreWeave’s share price and offered no protection against losses, according to

. Two Seas Capital, the largest active shareholder in Core Scientific, led the opposition, describing the proposal as “disappointing” and highlighting the risks associated with CoreWeave’s equity. Proxy advisory firms Institutional Shareholder Services (ISS) and Glass Lewis also advised voting against the merger, citing concerns about undervaluation and governance, as reported by CoinDesk.

Van Eck, now the 28th-largest shareholder in Core Scientific, also opposed the deal, labeling it a “golden parachute” for the company’s executives and pledging to vote against it, as previously noted by InvestorsObserver. Matthew Siegel, who leads digital assets research at Van Eck, stressed that Core Scientific has the potential to “drive the next wave of AI infrastructure” by focusing on building value independently rather than selling, according to InvestorsObserver. CoreWeave CEO Michael Intrator defended the proposal, describing it as the “best and final offer” and stating it would deliver “substantial benefits” to Core Scientific shareholders, according to a

.

The collapse of the merger highlights increasing doubts about all-stock deals in the AI industry, where company valuations can be highly unpredictable. Analysts pointed out that Core Scientific’s recent results—including a 45% year-over-year jump in AI-related revenue—have strengthened investor confidence in its ability to succeed independently, based on the company’s

. Roth Capital Partners upgraded Core Scientific from “Neutral” to “Buy,” viewing the failed merger as a chance for the company to advance its AI infrastructure projects without diluting shareholder value, according to .

Meanwhile, CoreWeave is under pressure to find new data center capacity as demand for AI computing grows rapidly. The company, which lists OpenAI and Microsoft among its clients, has stressed the importance of energy-efficient infrastructure to support advanced computing needs, according to

. Intrator said CoreWeave would maintain its business relationship with Core Scientific but acknowledged the end of the merger, CoinDesk reported.

The vote also reflects broader issues in corporate governance. Proxy advisors and activist investors are playing a larger role in shaping mergers, especially in fast-growing sectors where disagreements over valuation are frequent. For Core Scientific, turning down the CoreWeave deal may indicate a move toward prioritizing shareholder interests and operational agility as it transitions from bitcoin mining to AI-focused colocation services, according to a

.

With Core Scientific’s stock up more than 40% in 2025 and a liquidity reserve of $694 million, analysts believe the company is well-placed to pursue growth on its own, as highlighted in the TradingView analysis. Still, the company faces hurdles such as converting its facilities for AI workloads and managing debt as interest rates rise. The outcome of the shareholder vote has reignited debate about the strategic importance of AI infrastructure, with Core Scientific’s future depending on its ability to attract long-term clients and maximize its energy resources.

---