Elon Musk has reiterated his $97.4 billion offer to acquire OpenAI, stating that he will only retract his bid if Sam Altman, the CEO of OpenAI, agrees to halt the company’s transition into a for-profit entity. This move has escalated the ongoing power struggle between the two tech moguls, raising questions about the future of OpenAI.
Musk’s Ultimatum to OpenAI Board
Musk’s legal team recently filed a court document stating that his bid would only be withdrawn if OpenAI’s board commits to maintaining its original nonprofit mission. His offer, backed by a consortium of private equity and venture investors, aims to regain control of OpenAI and prevent its transformation into a fully commercial entity.
OpenAI’s Shift Towards a For-Profit Model
OpenAI was founded in 2015 as a nonprofit organization dedicated to developing AI for the benefit of humanity. However, due to financial constraints, it introduced a capped-profit model in 2019, creating a subsidiary to attract investors.
In December 2024, OpenAI announced plans to further transition its for-profit arm into a Delaware-based public benefit corporation (PBC), enabling it to raise more capital and compete with tech rivals like Anthropic and Inflection AI, both structured as PBCs. Under this restructuring, OpenAI’s nonprofit entity would still own shares in the for-profit company.
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The Musk-Altman Feud: A History of Conflict
The tension between Musk and Altman is not new. Musk was a co-founder of OpenAI, but his attempt to take over the company was rejected, leading to his departure.
Musk initially proposed merging OpenAI with Tesla, but after failing to gain control, he exited the organization. The rivalry intensified when OpenAI’s partnership with Microsoft deepened, prompting Musk to file a lawsuit against OpenAI.
Musk’s Offer and Altman’s Response
Despite Musk’s $97.4 billion bid, Sam Altman has publicly rejected the offer. In a social media post on X (formerly Twitter), Altman stated he was “not interested.” In response, Musk labeled Altman a “swindler.”
In an interview, Altman dismissed Musk’s actions, saying:
“Probably his whole life is from a position of insecurity… I feel for the guy.”
Musk, in turn, has continued to criticize Altman’s leadership, questioning his vision for artificial intelligence.
What’s Next for OpenAI?
Musk’s bid could force OpenAI’s board of directors to reassess its valuation, impacting the value of its for-profit subsidiary. However, with Altman firmly rejecting the deal, it remains uncertain whether OpenAI’s leadership will reconsider.
As the AI race intensifies, Musk’s xAI and Altman’s OpenAI continue to compete for dominance in artificial intelligence. With legal battles, corporate restructuring, and personal rivalries at play, the future of OpenAI’s governance remains a high-stakes debate in the tech world.
