Elon Musk Leads $97.4 Billion Bid to Take Over OpenAI

The OpenAI logo appears on a mobile phone in front of a computer screen with random binary data in Boston on March 9, 2023. Michael Dwyer/AP Photo

A group of investors led by tech billionaire Elon Musk is offering $97.4 billion to take over OpenAI.

Musk’s attorney, Marc Toberoff, confirmed that the bid—backed by Musk’s AI startup, xAI, and a consortium of investment firms—aimed to take control of OpenAI and reinstate its founding commitment to serving the public good rather than operating as a for-profit enterprise.

OpenAI CEO Sam Altman dismissed the offer in a pointed response on Musk’s social platform X, stating: “no thank you but we will buy Twitter for $9.74 billion if you want.”

Musk, who bought Twitter for $44 billion in 2022 before rebranding it as X, responded with a one-word post: “Swindler.”

Altman and Musk, who co-founded OpenAI in 2015, have feuded for years over the company’s direction. Musk left OpenAI’s board in 2018, later accusing the startup of straying from its nonprofit mission and aligning too closely with corporate interests, particularly Microsoft.

Musk, an early OpenAI investor and board member, sued the company last year, first in a California state court and later in federal court, alleging it had betrayed its founding aims as a nonprofit research lab benefiting the public good. Musk had invested about $45 million in the startup from its founding until 2018, Toberoff has said.

Last week, Musk’s legal team faced off against OpenAI’s attorneys in the U.S. District Court for the Northern District of California, where Judge Yvonne Gonzalez Rogers reviewed Musk’s request for a court order blocking OpenAI from formalizing its for-profit structure.

While the judge expressed skepticism about Musk’s claim of irreparable harm, she also raised concerns about OpenAI’s relationship with Microsoft and allowed the case to move toward a jury trial.

Toberoff, Musk’s attorney, has argued that if OpenAI insists on becoming a fully for-profit company, it must compensate its nonprofit origins fairly.

“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,” he told The Associated Press in a statement.

Additionally, Toberoff disclosed a January letter sent to the attorneys general of California and Delaware, urging them to oversee a competitive bidding process to determine OpenAI’s fair market value.

“As both your offices must ensure any such transactional process relating to OpenAI’s charitable assets provides at least fair market value to protect the public’s beneficial interest, we assume you will provide a process for competitive bidding to actually determine that fair market value,” Toberoff wrote.

In legal filings, Altman’s attorneys described Musk’s lawsuit as a strategic ploy to use litigation for competitive advantage after failing to gain control of the company.

“This suit is the latest move in Elon Musk’s increasingly blusterous campaign to harass OpenAI for his own competitive advantage,” Altman’s attorneys wrote. “OpenAI is dedicated to the safe and beneficial development of artificial general intelligence (‘AGI’). Musk once supported OpenAI in that mission, but abandoned the venture when his bid to dominate it failed.”

Altman’s attorneys argued that Musk’s claims lack legal and factual basis, and his lawsuit should be dismissed in its entirety.

The Associated Press contributed to this report.