Elon Musk to Withdraw $97.4 Billion OpenAI Bid if ChatGPT Maker Remains Non-Profit, Lawyers Say
Elon Musk’s consortium will pull its $97.4 billion bid for OpenAI’s non-profit arm if the organization decides against transitioning to a for-profit model, according to a court filing from Musk’s lawyers. Musk has been attempting to block the startup, which he co-founded and later departed from, from converting into a for-profit entity, a move he believes is crucial for OpenAI to secure more funding and maintain its position in the AI race.
Musk’s legal team stated that if OpenAI’s board is willing to preserve its charitable mission and halt the transition to a for-profit company, Musk will withdraw the bid. Otherwise, they argue, the charity must be compensated based on what an arms-length buyer would pay for its assets. Musk has emphasized that his offer is intended to further the non-profit’s mission.
OpenAI, led by CEO Sam Altman, has not yet received a formal bid from Musk’s group, and the company has responded by rejecting the bid, with Altman calling it “ridiculous.” OpenAI co-founded by Musk and Altman in 2015, was originally a non-profit but later shifted its direction when Altman launched a for-profit unit to secure investments, including funding from Microsoft.
Musk’s ongoing legal battle seeks to prevent OpenAI from becoming a fully for-profit entity. Altman is working on restructuring OpenAI so that the non-profit organization continues to hold a stake in the new for-profit company.
The situation could complicate OpenAI’s efforts to transition to a for-profit firm, as it could potentially set a high value floor for the non-profit. Additionally, reports suggest that SoftBank is in talks to lead a funding round that could value OpenAI at $300 billion, with the non-profit holding a significant stake in the company.
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