TLDR
- Two Seas Capital opposes CoreWeave merger, citing unfair deal terms.
- Core Scientific’s top shareholder slams $9B CoreWeave merger proposal.
- Two Seas urges a vote against CoreWeave deal, calls it undervalued and risky.
- CoreWeave merger sparks backlash from Core Scientific’s largest investor.
- Shareholder revolt grows over Core Scientific’s all-stock sale to CoreWeave.
Two Seas Capital LP has formally opposed Core Scientific’s planned $9 billion all-stock sale to CoreWeave. The firm, which holds over 6% of Core Scientific’s shares, announced its decision through a detailed open letter. It criticized the proposed transaction structure and valuation, urging other shareholders to vote against the deal.
Core Scientific Faces Pushback Over Deal Terms
Two Seas Capital, the largest active shareholder, challenged the fairness of the proposed merger with CoreWeave. It argued the terms favor CoreWeave, leaving Core Scientific shareholders with an uncertain value proposition. The firm also pointed to a 30% stock decline after the announcement as a sign of market concern.
BIG INVESTOR THREATENS PROXY FIGHT OVER COREWEAVE’S $CRWV DEAL FOR CORE SCIENTIFIC $CORZ – FT
— Wall St Engine (@wallstengine) August 7, 2025
The letter emphasized that the transaction undervalues Core Scientific’s assets and growth potential. Two Seas Capital, an early and long-term backer, highlighted the Company’s unique advantage in high-performance infrastructure. It added that current market conditions favor independent expansion rather than a premature exit.
Two Seas Capital also expressed concerns about the deal’s uncollared structure. Without price protections, this structure exposes Core Scientific shareholders to CoreWeave’s stock volatility. The firm said this design adds risk and limits future upside for current stakeholders.
All-Stock Structure Raises Risk Concerns
Core Scientific shareholders would receive 0.1235 CoreWeave shares for each of their CORZ shares. Based on June 25 prices, this represents a 66% premium; however, it leaves them with under 10% ownership in the combined company. Two Seas argues this proportion fails to reflect Core Scientific’s asset value and contribution.
CoreWeave seeks to absorb 1.3 GW of power capacity and plans to repurpose Core Scientific’s facilities for AI workloads. While this offers strategic value, critics say the transaction benefits CoreWeave disproportionately. CoreWeave has indicated potential divestment of Core Scientific’s mining business post-merger.
Although both firms resumed talks in June 2025, previous bids from CoreWeave had been rejected. Two Seas noted it supports strategic combinations but only at fair market value. It urged the Board to pursue revised terms or allow independent operation.
Shareholders Signal Hesitation Amid Strategic Shift
Core Scientific’s share price dropped sharply after the deal was announced. However, following the release of the open letter, CORZ rebounded slightly, suggesting renewed shareholder interest. Meanwhile, CoreWeave shares rose intraday, reflecting confidence in the potential acquisition.
Two Seas believes Core Scientific can continue growing independently due to rising demand for compute and energy infrastructure. It claims the company is well-positioned in the AI-era due to its scale and power access. Therefore, it argues there’s no urgency to sell at a discount.
The shareholder plans to campaign against the transaction unless structural and valuation concerns are addressed. It called on other shareholders to reject the current terms to protect long-term value. Discussions around the merger remain ongoing ahead of any final shareholder vote.
