CoreWeave joins data centre race: Nvidia-backed cloud computing firm set to buy Core Scientific for $9 billion
The cloud computing platform is following the trend of AI infrastructure firms racing to secure energy and data centre capacity needed to power surging demand.
The core of the deal lies in the urgent need of AI companies to expand their computing infrastructure, Reuters reported.
Amidst this growing demand, bitcoin miners' energy-intensive sites and power contracts, built during the crypto boom gained traction.
The deal will immediately eliminate more than $10 billion of cumulative future lease overhead to be paid for existing contractual sites over the next 12 years, CoreWeave said.
The offer values Core Scientific at $20.40 per share, representing a premium of around 66 per cent compared to the stock's closing price before reports of the deal emerged in late June.
Core Scientific stockholders will receive 0.1235 newly issued CoreWeave stock for each share they hold.
Following the announcement, Core Scientific's shares saw a steep drop of 22 per cent in morning trading, while Nvidia-backed CoreWeave was last down 4.5 per cent.
The deal is expected to close in the fourth quarter of this year, with the final price to be determined at that time.
Bitcoin miners have moved beyond their traditional area of cryptocurrency, tapping into the AI boom by leasing power and data center space to meet rising demand from AI workloads.
This acquisition is expected to set the bar for bitcoin miners looking for an opportunity of shifting to AI, Bernstein analyst Gautam Chhugani told Reuters, adding that power remains the biggest hurdle in AI data center expansion.
CoreWeave was originally founded as an Ethereum-focused crypto miner in 2017. However, the firm pivoted to AI a few years later.
It closed its mining business after "The Merge", Ethereum's 2022 upgrade, reduced rewards for miners.
CoreWeave's revenue has grown quickly, climbing more than eight-fold last year, according to the news agency.
The deal also marks a turnaround opportunity for Core Scientific, which filed for bankruptcy in late 2022 following a steep drop in bitcoin prices and rising energy costs.
The company emerged from bankruptcy in early 2024 and, like several other bitcoin miners, has been seeking a way to capitalise on the AI boom.
Core Scientific initially declined the takeover offer from CoreWeave in June 2024, citing that it was significantly undervalued.
The two companies later signed a series of 12-year contracts, including one under which Core Scientific agreed to provide CoreWeave with about 200 MW of infrastructure to charge its high-performance computing services.
CoreWeave, advised by Goldman Sachs, provides access to data centres and Nvidia-powered AI chips, with a current market value of about $79 billion, according to data compiled by Reuters.
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First Post
an hour ago
- First Post
Trump boasts of $14 tn US investment, WH lists just $2.6 tn, including $1.3 tn made under Biden
The White House calls it 'The Trump Effect' and features a rolling list on its website of more than 70 projects it says Trump's economic policies spurred, from a new bakery plant in Texas to a LEGO facility in Virginia and a microchip plant in Arizona read more Within hours of taking office in January, President Donald Trump boasted about attracting $3 trillion in new corporate investments to the United States. Since then, Trump has said the investments have swelled to $14 trillion, or roughly half of the nation's annual gross domestic product. The White House calls it 'The Trump Effect' and features a rolling list on its website of more than 70 projects it says Trump's economic policies spurred, from a new bakery plant in Texas to a LEGO facility in Virginia and a microchip plant in Arizona. STORY CONTINUES BELOW THIS AD As of July 2, the website listed more than $2.6 trillion in US investments, well short of the $14 trillion Trump boasts about. But a Reuters review found that just under half of the claimed spending on the website - totalling more than $1.3 trillion - originated under former President Joe Biden or represented routine spending repackaged to promote domestic investments. At least eight of the projects touted by the White House had sought or secured critical local incentive packages before Trump took office while at least a half dozen other projects had already been announced by local officials or the companies themselves, Reuters found. Two of the Trump Effect projects were aided by Biden's legislative efforts to boost domestic manufacturing, the review found. One company on the list, Swiss-based Roche, warned that Trump's plans to equalize US and international drug prices now threatens its promised $50 billion in US investments. Asked about taking credit for projects already underway before Trump came into office, the White House said the final investment decisions were announced under his watch and prove his economic policies are triggering US investment. 'President Trump is the greatest closer in modern history, and his leadership and policies are a critical catalyst converting hypothetical discussions into firm investment commitments and ground being broken for new plants and offices," White House spokesman Kush Desai said. STORY CONTINUES BELOW THIS AD The Reuters review included interviewing local officials and reviewing public records and corporate statements. It was not clear in many cases what role, if any, Trump or his policies played in getting the deals across the line. Mark Zandi, the chief economist at Moody's Analytics, said his economic forecast - along with the consensus estimates - for investment in the economy has remained relatively unchanged despite the White House's claims of new historic investments. 'I think despite all the announcements it hasn't translated into any change in expectations,' Zandi said. 'The fundamentals that ultimately drive investment spending, broadly, if anything, appear to have weakened since the start of the year.' Trump's push to impose sweeping tariffs on dozens of trading partners has injected uncertainty into global markets, lowering economic projections and freezing investment decisions, Zandi said. Trump's supporters say his policies of deregulation combined with the extension of his corporate tax cuts last week have stoked interest from companies that will be converted into actual investments in the months ahead. STORY CONTINUES BELOW THIS AD 'I think you're going to see a lot more investment later this year, and certainly into next year,' Richard Stern, director of economic and budget policy at the conservative Heritage Foundation, said. The Trump Effect The Trump Effect list is not exhaustive, according to the White House, and does not include the foreign deals the administration says Trump secured during his Middle East tour in May. The White House did not respond to a Reuters request to provide a breakdown of the $14 trillion in US investments Trump claims he has attracted. Trump wouldn't be the first president to inflate or embellish economic activity on his watch. But the onetime businessman has made his dealmaking the centerpiece of his political persona, promising his presidency would ignite a manufacturing renaissance that would bring jobs back to the US Some companies, largely in the pharmaceutical industry, repackaged existing spending that was later touted as new investment by Trump. The pharmaceutical companies also credited Trump's 2017 tax cuts for spurring domestic investment. STORY CONTINUES BELOW THIS AD Eli Lilly CEO David Ricks created the blueprint, said James Shin, a pharmaceutical analyst at Deutsche Bank Securities. Ricks joined top administration officials in February to announce $27 billion in new US investments over five years. The figure drew praise from Trump who said it's evidence his tariffs were working to spur domestic manufacturing, but the figure represented a slight increase over the $23 million the company spent in the US since 2020. 'Everyone saw that Donald Trump gave David Ricks blessings every time he spoke,' Shin said. 'I think Lilly was quite shrewd in its timing and in its messaging.' An Eli Lilly spokesperson did not address Reuters questions about the company's incremental increase in spending and what role Trump played, if any, in its announcement. Claiming credit Here's a sampling of the projects included on the White House's Trump Effect website that Reuters found had been announced or were already in the pipeline prior to Trump's presidency: STORY CONTINUES BELOW THIS AD Hyundai: The South Korean carmaker was added to the Trump Effect list after announcing a $5.8 billion new Louisiana steel plant in March. But the company selected the Louisiana site in December 2024 after conducting a nationwide search, according to a state official. Hyundai did not respond to a request for comment, Corning: The global materials science company was added to the list after a $1.5 billion investment in Michigan was highlighted in an April press release. But the figure includes $900 million in funding announced in February of last year for the plant, and the project has benefited from federal tax credits under the CHIPS and Science Act, a bipartisan measure passed under Biden that incentivizes domestic production, the company confirmed to Reuters. Trump has called for Congress to claw back the chips funding, calling the legislation a 'horrible, horrible thing.' The company would not say whether Trump had any direct connection to the investment. STORY CONTINUES BELOW THIS AD LEGO: The iconic toy manufacturer announced a new $366 million distribution center in Virginia in May and was added to the Trump website. The company began working with Virginia on a package of state and local incentives in 2022, roughly three years before Trump took office, according to Pryor Green, the Virginia economic development spokesperson. The company did not respond to request for comment. Clasen Quality Chocolate: The candy company announced a new $230 million production facility in Virginia in February and was added to Trump's website. But the Virginia Economic Development Partnership began working with the company roughly seven months before Trump took office, and Governor Glenn Youngkin approved a $3 million grant for the project on December 3, Green told Reuters. The company did not respond to a request for comment. Chobani: The White House added the yogurt maker to its list after the company in April announced a $1.2 billion production plant in New York. But Chobani, which did not respond to a request for comment, had reached out to the state in May of last year about the project, state records show, and benefited from a state program that lures companies with shovel-ready sites. STORY CONTINUES BELOW THIS AD Local incentives Some other deals touted by Trump were either struck before he took office, spurred by state and local incentive packages or represent routine capital investment, the Reuters review found. Pharmaceutical companies Merck and Johnson & Johnson both announced billions of dollars in US investments that included projects that were previously announced and already under construction, according to a review of company statements. The White House list included $2 billion in Merck projects already underway in North Carolina and Delaware and a $2 billion North Carolina project under construction by Johnson & Johnson, statements show. Johnson & Johnson did not respond to a request for comment, and Merck did not address Reuters' questions about Trump's role in its investment decisions. Many of the projects on the list relied heavily on state and local incentive packages - such as grants or tax breaks - that were approved prior to Trump taking office in January, Reuters found. States typically compete against one another for company investments, using incentive packages as bait. The locally-backed projects on the Trump Effect list include Diageo, a British alcoholic beverage company, whose $415 million new Alabama plant was aided by state and local tax incentives that date back to 2022, roughly three years before Trump took office, according to Stefania Jones, an Alabama Department of Commerce spokesperson. Diageo did not respond to requests for comment. Ireland-based power management company Eaton Corporation, French ceramics manufacturer Saint-Gobain and South Korean baker Paris Baguette, for example, were all highlighted on the Trump Effect list, but records and interviews show they all secured local incentive packages before Trump took office. The companies did not respond to requests for comment. Tech investments In some cases, the investment touted by the White House and the companies represented the normal cost of business. Apple CEO Tim Cook announced in February that his iconic company was going to invest $500 billion over five years to hire 20,000 workers and build new AI servers. Trump seized on the announcement, saying on his Truth Social media platform that it showed 'faith in what we are doing.' However, Apple's announced figure is in line with what one might expect the company to be spending anyway, given its financials, according to three analysts. 'For Apple, most of this would have happened regardless of who's president,' said Dan Ives, a senior equity analyst with Wedbush Securities. It also echoes previous commitments. Four years ago, a few months after Biden's inauguration, Apple announced an 'acceleration' of its US investments, pledging to spend $430 billion and add 20,000 jobs over five years. In January 2018, during Trump's first term, the company said that its 'direct contribution to the US economy' would be $350 billion over five years and that it planned to create 20,000 jobs over that period. Another pledge to spend $500 billion for new data centers to power artificial intelligence programs dubbed 'Stargate' came from ChatGPT-maker OpenAI, Japanese conglomerate SoftBank and business software giant Oracle, whose executives joined Trump in the White House on his first full day as president in January to make the announcement. The companies said they planned to spend $100 billion 'immediately' but that they were still in negotiations with various states about where to place the new data centers. 'As announced in January, Stargate remains fully committed to investing up to $500 billion over the next four years to build AI infrastructure in the United States," SoftBank and OpenAI said in a joint statement to Reuters. Oracle did not respond to a request for comment.
Time of India
2 hours ago
- Time of India
How one tiny Myanmar town controls the globe's rare earth supply and is holding the world hostage
Bhamo, a town in the northern hills of Myanmar, home to just 166,000 people, may appear to be a small town, but it is where almost half of the world's heavy rare earths are found, like the minerals essential for electric cars and wind turbines, as per a report. The Civil War That Could Disrupt EVs Worldwide Since December, Kachin Independence Army (KIA), an ethnic militia, has been fiercely fighting Myanmar's junta for control of Bhamo, which is a civil war that started after the military's 2021 coup, as reported by Reuters. The town is within 100 kilometres of the Chinese border and is a strategically vital garrison town, according to the report. The takeover of Bhamo would grant the KIA control of the primary rare-earth mining area, something that has shaken China and caused supply chain disturbances globally, as per the Reuters report. China's Critical Role in Rare Earth Processing The heavy rare earths are usually shipped to China for processing into magnets that power electronic vehicles and wind turbines, as China has a near-monopoly over the processing of the minerals, as reported by Reuters. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Play War Thunder now for free War Thunder Play Now Undo ALSO READ: SoFi stock surges 7% on Trump tax plan hype — earnings buzz builds ahead of July 29 Beijing's Ultimatum China has now reportedly threatened to stop buying the minerals mined in KIA-controlled territory unless the militia stops trying to seize full control of Bhamo, Reuters reported, citing people familiar with the matter. Live Events A KIA official told Reuters that, in May, China had made its demand, and a KIA commander pointed out that Beijing was represented by foreign ministry officials at the talks, according to the report. The ongoing fight in the region has limited mining operations, and rare-earth exports from Myanmar and now China is "using its dominance to shore up Myanmar's beleaguered junta, which China sees as a guarantor of its economic interests in its backyard," wrote Reuters in its report. While China's foreign ministry told Reuters that it was not aware of the specifics of deliberations with the KIA, but said that, "An early ceasefire and peace talks between the Myanmar military and the Kachin Independence Army are in the common interests of China and Myanmar as well as their people," as quoted in the report. ALSO READ: Wolfspeed stock soars over 100% after shock CFO appointment — who is Gregor van Issum? The KIA official revealed that Beijing had offered a greater cross-border trade with KIA-controlled territories if the militia stopped efforts to seize Bhamo, as reported by Reuters. The official said, "And if we did not accept, they would block exports from Kachin State, including rare-earth minerals," as quoted in the report. An independent Myanmar-focused analyst, David Mathieson, pointed out that Beijing is not seeking to resolve the wider civil war, but it wants fighting to stop as it wants to advance its economic interests, and said that, "China's pressure is a more general approach to calming down the conflict," as quoted in the Reuters report. Conflict Disrupts Mining and Exports The ongoing conflict in Bhamo started just after the KIA wrested control of the main rare-earth belt in Kachin last October, and since its takeover, the KIA has increased taxes on miners and throttled production of dysprosium and terbium, sending prices of the latter skyrocketing, as reported by Reuters. FAQs Who is fighting over Bhamo? The Kachin Independence Army is fighting Myanmar's military junta for control of the region, as per the Reuters report. What happens if China follows through on its threat? Global supply chains could be shaken, prices for rare earths could spike, and manufacturers might struggle to get the materials they need, as per the Reuters report.
Time of India
2 hours ago
- Time of India
Donald Trump says more tariff letters coming! US President warns no extension on August 1 deadline; ‘there has been no change…'
US President Donald Trump on Tuesday firmly declared that sweeping new tariffs on foreign imports will come into effect from August 1, 2025, warning that no further extensions will be granted. Taking to his Truth Social platform, Trump wrote, "As per letters sent to various countries yesterday, in addition to letters that will be sent today, tomorrow, and for the next short period of time, TARIFFS WILL START BEING PAID ON AUGUST 1, 2025." "There has been no change to this date, and there will be no change." He added that all payments would be due starting August 1, 2025, with no extensions to be considered. 'Thank you for your attention to this matter,' he concluded. This latest statement sharply contradicts Trump's earlier comments when he had suggested the deadline was 'firm, but not 100 percent firm,' leaving some room for last-minute negotiations. US treasury secretary Scott Bessent had previously said the tariffs would not take effect until August 1, in an effort to allow more time for negotiations. Earlier on Sunday, while boarding Air Force One, Trump had told reporters he planned to send out '12, could be 15' letters the following day to countries across the globe. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like 5 Books Warren Buffett Wants You to Read In 2025 Blinkist: Warren Buffett's Reading List Undo Hours later, he confirmed via Truth Social that the letters would begin going out from 12:00 p.m. (Eastern) on Monday, July 7. The letters, addressed to more than a dozen nations including Japan, South Korea, Indonesia, Bangladesh, Thailand, South Africa and Malaysia, outline tariffs ranging from 25% to 40%, unless trade deals are reached before the August 1 deadline. Japan and South Korea, both key US trading partners, have already received notices confirming 25% duties from that date. India, is also currently in talks for the trade deal, which Trump claimed were very close to be finalised. On April 2, which Trump called "Liberation Day," he announced the first wave of tariffs, including a 10% duty on most imports and significantly higher rates for certain countries, including several EU members. However, the duties were put on hold for 90 days, setting an initial deadline of July 9, a pause that ultimately laid the groundwork for the new enforcement date of August 1. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
