Elon Musk’s $97.4 billion offer to acquire OpenAI has been rejected by CEO Sam Altman. The bid, reportedly submitted on Feb. 10 by a Musk-led investor group, sought to take control of the AI firm. However, Altman swiftly dismissed the proposal, responding on X, “no thank you but we will buy twitter for $9.74 billion if you want.”
Musk, who bought Twitter (now X) for $44 billion in 2022, seemingly fired back by sharing a video of Altman’s 2023 congressional testimony, where he stated he owned no equity in OpenAI. Musk captioned the post: “Scam Altman.”
Musk’s Longstanding Feud With OpenAI
Musk and Altman co-founded OpenAI in 2015 as a nonprofit, but their relationship soured after Altman pushed to transition the company into a for-profit model. Musk, who left OpenAI in 2018, has been vocal about his concerns over the firm’s direction, arguing that it deviated from its original mission of open-source AI development.
In August, Musk sued OpenAI and Altman, alleging they abandoned their nonprofit commitment. Though he later dropped the lawsuit after OpenAI published internal emails suggesting Musk had acknowledged the need for a revenue model, his legal team remains adamant about the company’s shift. “It’s time for OpenAI to return to the open-source, safety-focused force for good it once was,” Musk’s lawyer, Marc Toberoff, said in a statement.
Investors Back Musk’s Bid
Musk’s bid for OpenAI is supported by his AI startup xAI and several major investment firms, including Baron Capital, Vy Capital, and 8VC. Toberoff told The Wall Street Journal that the investor group is willing to match or exceed any competing offers, emphasizing that OpenAI’s nonprofit wing deserves proper compensation if the company fully transitions into a for-profit entity.
“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 stated.
OpenAI’s Soaring Valuation
OpenAI’s for-profit subsidiary, OpenAI Global, LLC, was created in 2019, a year after Musk’s departure. The shift allowed OpenAI to attract major investors like Microsoft, which has funneled billions into the company. OpenAI is also part of “Stargate,” a $500 billion private-led AI infrastructure investment initiative announced last month.
The firm was valued at $157 billion during a $6.6 billion funding round in October 2024. However, CNBC recently reported that SoftBank is nearing a $40 billion deal with OpenAI at a staggering $260 billion valuation, underscoring the firm’s growing dominance in the AI sector.
