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SHOCKING MERGER: Core Scientific’s Desperate Dance with CoreWeave Unveils Financial Fiasco!
In a jaw-dropping revelation, Core Scientific is reeling in panic over its cash crisis just as it jumped into bed with CoreWeave! Recent filings reveal that the company was on the brink of financial doom before sealing the controversial deal—and shareholders are NOT happy!
Doomsday Approaches: Cash Crunch Predicted for 2025!
Just when you thought the tech world couldn’t get more shocking, the realities of Core Scientific’s finances hit hard! If it had stayed solo, insiders predict it would have faced a cash bonanza—or should we say, a cash apocalypse—by mid-2025! The Securities and Exchange Commission documents divulge a terrifying truth: there was NO guarantee additional funding was on the horizon!
The Deal Drama: Shareholders Unite Against the Merger Madness!
With a value of a whopping $9 BILLION when announced, the merger has taken a nosedive—with shares plummeting from $165 to a mere $91! Those invested are furious! Notably, hedge fund Two Seas Capital, controlling over 6% of Core Scientific, has blasted the deal as “deficient” and is threatening to ignite a proxy battle against this tumultuous marriage of companies!
Merging Madness: No Cash and No Safety Net!
What’s more shocking? The deal lacks a financial safety net known as a “collar”—setting off alarms among anxious investors! Core Scientific has been haggling with CoreWeave like they’re at a yard sale. After an unsolicited offer, back-and-forth negotiations led to a final offer of mere 0.1235 shares—leading to simmering tensions and rage among shareholders!
A Surprising Twist: CoreWeave is Closer Than Ever!
The two companies have been cozy since 2019, suggesting that this merger isn’t just about business; it’s personal! CoreWeave’s CEO even joins Core Scientific’s board — talk about a close relationship! Amidst this whirlwind, they argue that joining forces will save a staggering $10 BILLION in leasing costs.
Bitter Dividends: What’s Next for Shareholders?
If this wild ride gets the green light, Core Scientific investors will hold a meager 9% of the newly merged entity. It’s a bitter pill to swallow, and the companies attempt to sell it as a win with promises of a lower cost of capital.
Advisory Fees and Fallouts: The Financial Fallout Continues!
Adding fuel to the fire, Core Scientific’s primary financial adviser, Moelis & Co, stands to rake in a whopping $40 million to $50 million if this deal goes through. But with CoreWeave’s shares tumbling, the advised fee is falling faster than the stock price, leaving investors on edge!
In this saga of financial intrigue, corporate chaos, and shareholder outrage, one thing is clear: the aftermath of this desperate merger could spell disaster! Keep your eyes peeled as this explosive story continues to develop!
photo credit: www.ft.com
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