US Stock Market Move | Vetoed CoreWeave (CRWV.US) Acquisition Offer Core Scientific (CORZ.US) Rises Over 6%

On Thursday, the stock price of Core Scientific (CORZ.US), a U.S. data center operator, rose as of the time of writing, with the stock up over 6% at $22.08. CoreWeave (CRWV.US) dropped over 5% to $132.67. On the news front, Core Scientific shareholders voted to reject the acquisition offer proposed by artificial intelligence infrastructure company CoreWeave at a special shareholder meeting, ending a months-long acquisition tug-of-war. The voting results showed that the transaction failed to obtain the necessary support, leading Core Scientific to announce the termination of the merger agreement and continue to operate as an independent publicly listed company. The deal was initially announced in July of this year, with CoreWeave planning to acquire Core Scientific for approximately $9 billion as part of its AI computing infrastructure expansion and acquisition wave. However, the deal faced resistance from various parties since its announcement, including opposition from Core Scientific's significant shareholder Two Seas Capital, as well as recommendations from two major proxy advisory firms, Glass Lewis and Institutional Shareholder Services (ISS), to vote against the transaction. In a report released earlier this month, Glass Lewis indicated that the acquisition had "some strategic rationale" for Core Scientific shareholders, as the combination of the two could integrate data center operations with CoreWeave's AI cloud computing infrastructure. However, the report also emphasized that in the midst of the AI investment frenzy, Core Scientific as an independent company may have "greater upside potential," provided that the company can fully capitalize on the growing demand for computing power. ISS gave a similar conclusion, advising shareholders to reject the transaction. In fact, the market had long anticipated that the acquisition could fall through. In the months following the announcement of the deal, the so-called "deal spread" consistently remained in negative territory, reflecting arbitrage traders' widespread pessimism about the likelihood of the acquisition being completed. JonesTrading event-driven analyst Cabot Henderson bluntly stated before the vote, "Most arbitrageurs believe this deal is dead." CoreWeave CEO Michael Intrator reiterated multiple times throughout the process that the company would not raise the acquisition offer. In a statement released on Thursday, he expressed respect for the decision of Core Scientific shareholders and stated that the company would continue to maintain its existing partnership with them. "CoreWeave's strategic direction will not change," he said. "We will continue to execute steadily according to the established roadmap, creating long-term value for shareholders through strategic mergers and prudent investments."