Elon Musk’s Consortium Offers $97.4bn to Take Over OpenAI Amid Feud with CEO Sam Altman

A consortium led by Elon Musk has submitted an unsolicited $97.4 billion bid to acquire OpenAI, the nonprofit-turned-for-profit company behind the popular AI tool ChatGPT. This offer, confirmed by Musk’s attorney Marc Toberoff, is set to escalate the billionaire’s long-standing feud with OpenAI CEO Sam Altman and the company’s leadership.

The bid, which was officially sent to OpenAI’s board on Monday, seeks to acquire “all assets” of the tech company. The move comes months after Musk sued OpenAI in an effort to block its transition to a for-profit structure, arguing that it strays from its original mission of using AI for the benefit of humanity.

In a statement, Toberoff emphasized that the consortium, which includes Musk’s AI company xAI and several private investment firms, is willing to match or exceed any higher bids for OpenAI. He also stated that Musk is the best-suited leader to protect and expand OpenAI’s technology.

“If Sam Altman and the present OpenAI, Inc. Board of Directors are intent on becoming a fully for-profit corporation, it is vital that the charity be fairly compensated for what its leadership is taking away from it: control over the most transformative technology of our time,” Toberoff explained.

Musk’s offer is significant, especially in light of OpenAI’s recent valuation of $157 billion in its latest funding round, with rumors that the company’s valuation could be as high as $300 billion in upcoming funding discussions. Despite this, the $97.4 billion bid represents a lower figure and is seen as a potential challenge to OpenAI’s restructuring plans, which aim to raise capital needed to compete in the AI space.

OpenAI, which was originally founded as a nonprofit in 2015 by Musk and Altman, has since made efforts to transition into a for-profit entity to secure the necessary funding for advancing AI technologies. Altman, who remains the company’s CEO, has argued that this shift is essential for the company’s growth and long-term sustainability, especially in a highly competitive and resource-intensive field like artificial intelligence.

The proposal, which Musk’s attorney framed as a way to restore OpenAI to its “open-source, safety-focused” roots, has been met with resistance. Altman responded swiftly on social media, rejecting Musk’s offer with a tongue-in-cheek reply, suggesting the group could instead purchase Musk’s Twitter (now X) for $9.74 billion.

Musk’s bid also adds another layer to his ongoing legal and public dispute with OpenAI. The Tesla and SpaceX CEO has previously expressed dissatisfaction with OpenAI’s shift towards commercialization, alleging that the company had betrayed its original mission. Musk’s legal battles with the company have been marked by his claim that the nonprofit’s leadership should be held accountable for making profit-driven decisions, including its partnership with tech giant Microsoft.

Musk’s latest move is being supported by a group of prominent investors, including Joe Lonsdale, co-founder of the government contractor Palantir, and entertainment mogul Ari Emanuel. Their backing, along with Musk’s own xAI company, positions the offer as a potentially formidable challenge to OpenAI’s leadership.