Elon Musk’s consortium has put forth a bid of $97.4 billion to acquire the non-profit organization that oversees OpenAI, after Musk previously filed a lawsuit against the artificial intelligence startup to prevent its transition to a for-profit entity.
The revelation of Musk’s bid on Monday may escalate tensions with OpenAI CEO Sam Altman regarding the future of the startup that plays a pivotal role in the growth of generative AI technology.
In response to Musk’s offer, Altman promptly took to X and stated, “No thank you, but we will acquire Twitter for $9.74 billion if you’re interested.”
The two parties are currently entangled in a legal battle. Musk criticized a $500 billion project led by OpenAI called Stargate, which was announced with great pomp at the White House shortly after President Donald Trump’s return to office, implying that the investors lacked the necessary funding for the project.
“It is time for OpenAI to revert to being the open-source, safety-focused entity for good that it previously was,” Musk declared in the press release. “We will ensure that this happens.”
Up to the time of this report, OpenAI, Musk, Musk’s attorney Marc Toberoff, and OpenAI supporter Microsoft have not responded to requests for comments from Reuters.
Musk’s bid is being supported by his AI company, xAI, which may potentially merge with OpenAI post-acquisition, as reported by The Wall Street Journal, the first to disclose Musk’s offer earlier in the day.
Apart from considerations related to antitrust laws, a deal of this magnitude would necessitate Musk and his consortium to raise substantial funds.
In the most recent funding round in October, OpenAI was valued at $157 billion, solidifying its position as one of the most valuable privately-owned companies globally. SoftBank Group is currently in discussions to lead a funding round of up to $40 billion in OpenAI, valuing the company at $300 billion, inclusive of the new funds, as reported by Reuters in January.
Although Musk co-founded OpenAI with Altman in 2015, he departed before the company achieved significant success. In 2023, he established the competing AI startup xAI.
OpenAI is presently working towards transitioning from a non-profit to a for-profit entity, citing the necessity for capital to develop top-tier artificial intelligence models.
Musk’s legal action against OpenAI and Altman alleges that the founders had initially approached him to fund a non-profit organization focusing on developing AI for the betterment of humanity, but the organization has since shifted its focus to profitability.
