Issues Open Letter to Core Scientific Shareholders Outlining Its Belief that the Proposed Transaction Materially Undervalues Core Scientific and Unnecessarily Exposes Shareholders to Substantial Economic Risk
NEW YORK, Aug. 7, 2025 -- Two Seas Capital LP ("Two Seas" or "we"), an alternative investment management firm and the largest active shareholder of Core Scientific, Inc. ("Core Scientific" or the "Company") (NASDAQ: CORZ), today announced its opposition to the Company's proposed sale to CoreWeave, Inc. ("CoreWeave") (NASDAQ: CRWV) on the terms announced on July 7, 2025.
Two Seas also released the following open letter to fellow Core Scientific shareholders explaining why it opposes the transaction.
August 7, 2025
Dear Fellow Core Scientific Shareholders:
Two Seas Capital LP ("Two Seas" or "we") is an alternative investment management firm that has been a committed investor in, and staunch advocate of, Core Scientific, Inc. ("Core Scientific" or the "Company") since 2022. We were early members of the ad hoc equity committee, supported the Company's emergence by joining in the rights offering in early 2024, participated in both convertible note issuances, and have grown our equity stake over the past 18 months. Today, we beneficially own 19,122,842 shares of Core Scientific's common stock, representing approximately 6.3% of the Company, making us the Company's largest active shareholder.
We invested in Core Scientific because we believe strongly in the Company's ability to create substantial value as a first-mover in building critical, high-performance computing ("HPC") infrastructure at scale. Artificial intelligence ("AI") represents one of the most significant technological developments of this century. As the need for AI training and inference has grown, the demand for energy and HPC infrastructure has increased dramatically. Core Scientific – with its significant scale, ready access to low-cost power, and data center talent – is uniquely positioned to meet this growing demand and has a clear runway to compound growth for many years.
We are therefore disappointed that the Board of Directors has chosen to sell the Company to CoreWeave, Inc. ("CoreWeave") at this inadequate valuation. The proposed all-stock, uncollared structure leaves Core Scientific shareholders exposed to the high volatility of CoreWeave's share price with no protections on the value they will receive at or following close.
We are not philosophically opposed to a merger of these two parties. We are also investors in CoreWeave, believe in its strategy, and respect its management team. Moreover, we have advocated for this combination as we clearly recognize the strategic merits.
However, from our perspective as a shareholder of Core Scientific, the proposed sale materially undervalues the Company and unnecessarily exposes its shareholders to substantial economic risk. In our view, the transaction decidedly and unfairly favors CoreWeave at the expense of Core Scientific shareholders. The fact that Core Scientific's stock price declined by 30% in the days following the transaction announcement strongly suggests to us that other investors agree.
We would be happy to continue owning Core Scientific as an independent company for years to come. With the demand for power and compute infrastructure rising at an unprecedented pace, and supply remaining scarce, we believe the Company's most promising days lie ahead. In our view, there is no compelling reason to sell Core Scientific at an underwhelming valuation with a deficient structure.
To be clear, we welcome all suitors, including CoreWeave, to bid on Core Scientific. The Board's job, however, is to ensure that any such deal happens at a price that reflects the strategic value of the Company's assets – including the value of any synergies, the existence of which CoreWeave has already acknowledged. In our view, the current transaction does not come close to meeting that standard.
Accordingly, unless the terms are revised to address what we believe to be both the structural shortcomings and inadequate consideration, we intend to vote against the transaction and plan to solicit you, our fellow Core Scientific shareholders, to do the same. We do not believe this transaction should receive shareholder approval.
We will further articulate our perspectives, and our valuation work, in the coming weeks and look forward to engaging with you then.
Sincerely,
Sina Toussi
Founder, President and Chief Investment Officer
Two Seas Capital LP
About Two Seas Capital LP
Two Seas, founded in 2020 and led by Chief Investment Officer Sina Toussi, specializes in event-driven investing anchored by rigorous fundamental research and a targeted focus on special situations. With approximately $1.4 billion in assets under management, Two Seas' approach is designed to uncover market inefficiencies where value can be realized through the resolution of legal and regulatory events. The Two Seas team is highly regarded for its rigorous due diligence and its ability to translate complex and dynamic scenarios into actionable investment opportunities.
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