A group of investors, led by Elon Musk, has made an unsolicited $97.4 billion offer to take control of OpenAI, adding another layer of complexity to the billionaire's ongoing legal battle with the ChatGPT developer and its CEO, Sam Altman.
Musk's surprising bid to acquire the AI startup—currently in the process of transitioning to a for-profit model—is backed by major venture firms, including Joe Lonsdale's 8VC, Valor Equity Partners, Baron Capital, Atreides Management, Vy Capital, and Endeavor CEO Ari Emanuel, The Wall Street Journal reported. The offer is also supported by Musk's AI company, xAI, which could merge with OpenAI if the deal goes through, the outlet reported.
Musk's Hostile Takeover Attempt
Musk's attorney, Marc Toberoff, confirmed to The Wall Street Journal that the takeover proposal was officially submitted to OpenAI's board of directors on Monday. "It's time for OpenAI to return to the open-source, safety-focused force for good it once was," Musk said in a statement. "We will make sure that happens."
Just minutes after Musk's team announced the offer, Altman rejected it—seemingly taking a jab at the $44 billion Musk spent to acquire X, formerly known as Twitter. "No thank you but we will buy Twitter for $9.74 billion if you want," Altman wrote on X.
Musk replied to Altman's post with one word: "Swindler."
After becoming CEO, Altman launched OpenAI's for-profit division, enabling the company to secure funding from major investors like Microsoft. He has outlined a plan to transition the for-profit division into a traditional company while maintaining the nonprofit side, which would retain equity in the business.
The offer comes as Musk is actively suing OpenAI in an attempt to derail Altman's efforts to convert the organization into a for-profit company.
Earlier this month, a federal judge ruled that certain aspects of Musk's lawsuit could proceed to trial, contingent on Musk testifying in court.
Toberoff also told The Wall Street Journal that Musk and his backers are prepared to match any rival bids for the nonprofit.
"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 told the outlet.
Beginning of a New War
Musk's takeover bid raises fresh uncertainties about OpenAI's future and who will ultimately control the company. OpenAI has maintained that its nonprofit division will receive the full value of its stake in the firm, though it will no longer have authority over its operations.
The company is planning to transition into a for-profit public benefit corporation, a structure where leadership must balance financial gains with societal impact when making decisions. As part of this shift, Altman is expected to receive an ownership stake.
Last fall, the ChatGPT developer raised $6.6 billion in funding, bringing its valuation to $157 billion. OpenAI has pledged to complete its restructuring within two years, or else, investors will have the option to renegotiate the company's valuation.
Musk and Altman since their split have become fierce competitors, frequently exchanging public criticisms as their respective firms battle for dominance in the AI industry.
When Altman appeared alongside President Trump and other officials at the White House last month to introduce the $500 billion "Stargate" AI infrastructure project, Musk publicly questioned whether they had sufficient funding to execute the initiative.
