Elon Musk and a consortium of investors have made an unsolicited $97.4 billion offer to acquire OpenAI’s controlling non-profit entity, further complicating the company’s transition into a for-profit structure under CEO Sam Altman. The bid, submitted to OpenAI’s board on Monday, underscores the intensifying rivalry between Musk and Altman as both compete to shape the future of artificial intelligence.
Musk, a co-founder of OpenAI who left its board in 2018, has been a vocal critic of the company’s move away from its original non-profit mission. His legal team has also urged regulators in Delaware and California to intervene, arguing that OpenAI should be subject to a competitive bidding process. OpenAI, however, has stated it has no plans to entertain external offers.
In response to the bid, Altman dismissed the proposal, even quipping on X (formerly Twitter) that OpenAI would be willing to buy the social media platform for $9.74 billion. Musk, who acquired Twitter in 2022 for $44 billion, has not publicly responded.
Legal experts have pointed out that Musk faces significant challenges in forcing a sale. OpenAI’s non-profit board maintains control over the company, and unless its governance structure changes, it remains bound by its original mission. This governance model, however, has been a point of contention, particularly as OpenAI pursues an estimated $260 billion valuation while raising new capital for AI development.
Musk’s legal action is the latest flashpoint in an ongoing power struggle. Both OpenAI and Musk’s AI startup, xAI, are aggressively competing to lead the artificial intelligence sector, securing substantial investments and building vast data centers. OpenAI, for instance, is planning a $500 billion AI infrastructure initiative, backed in part by SoftBank, under the project name Stargate.
One of the unresolved questions in OpenAI’s transition to a for-profit model is determining the value of its non-profit entity. Past discussions placed its valuation around $30 billion, though Musk’s legal team contends that figure should be significantly higher. A higher valuation could also mean a substantial financial windfall for Musk, given his early contributions to the organization.
Despite the high-profile dispute, OpenAI maintains it is under no obligation to accept Musk’s bid. Without changes to its governance, legal experts suggest Musk’s options remain limited to persuasion rather than enforcement.
