Elon Musk and a consortium of investors have made a $97.4 billion bid to acquire the nonprofit that controls OpenAI, intensifying tensions between Musk and OpenAI CEO Sam Altman. The offer, announced Monday, is Musk’s latest move to prevent the AI company from shifting to a for-profit model, a transition OpenAI argues is necessary to secure funding for cutting-edge AI development.
Altman swiftly rejected the bid, posting on X: “no thank you but we will buy twitter for $9.74 billion if you want.” Musk, who cofounded OpenAI in 2015 but left before its rise, now operates his own AI startup, xAI, which launched in 2023. His bid for OpenAI comes amid his broader influence in politics, as a key ally of President Donald Trump and head of the Department of Government Efficiency, a White House agency focused on reducing federal bureaucracy.
Musk’s legal battle with OpenAI began last year when he sued Altman and others, accusing them of prioritizing profit over public good in the race to develop AI. His lawsuit claims OpenAI has strayed from its original mission to build AI for the benefit of humanity and that its shift to a for-profit model violates initial agreements.
“It’s time for OpenAI to return to the open-source, safety-focused force for good it once was,” Musk said Monday. “We will make sure that happens.”
The bid, if taken seriously, would create massive financial and regulatory hurdles. OpenAI’s last funding round pegged its valuation at $157 billion, with reports indicating SoftBank is in talks to lead a new $40 billion round at a $300 billion valuation. Musk’s ability to finance such a deal remains uncertain, with analysts speculating he could sell Tesla shares, leverage his stake in SpaceX, or take out loans.
Legal experts say OpenAI’s board has a fiduciary duty to evaluate Musk’s offer. Jonathan Macey, a Yale Law School professor, said the situation “throws a wrench in things,” as the nonprofit must ensure it acts in the best interest of its mission and stakeholders.
While Musk’s attempt to take control of OpenAI faces significant obstacles, his bid adds new pressure on OpenAI as it seeks billions in fresh investment.
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