- Musk’s $97.4B bid hinges on OpenAI remaining a non-profit
- OpenAI CEO Sam Altman rejects Musk’s offer
- The bid raises questions over OpenAI’s valuation and future
Elon Musk has drawn a hard line in his battle against OpenAI’s restructuring plans, warning that his consortium will withdraw its $97.4 billion bid for the company’s non-profit arm if it transitions into a for-profit entity. The legal filing, submitted Wednesday, underscores Musk’s ongoing efforts to challenge the company’s governance model and influence its future.
Musk’s Legal Challenge and OpenAI’s Response
Musk, a co-founder of OpenAI who departed in 2018, has vehemently opposed the AI giant’s shift towards a profit-driven structure. This move could help the company secure additional funding and maintain a competitive edge in AI.
“If OpenAI’s board is willing to uphold the original charitable mission and halt its transition to a for-profit model, Musk will withdraw the bid,” his legal team stated in the filing. However, if the restructuring proceeds, the filing added that the non-profit arm must be fairly compensated based on market value.
OpenAI CEO Sam Altman has dismissed Musk’s bid as “ridiculous,” insisting that the company’s non-profit governance structure is not for sale. While OpenAI has not yet received an official bid from Musk’s group, the unsolicited offer has sparked debate over the organization’s future and the valuation of its non-profit assets.
Financial and Industry Implications
Industry experts and investors have closely watched OpenAI’s restructuring. Initially launched as a non-profit in 2015, the company later created a for-profit subsidiary to attract investors, including Microsoft, which has committed billions to support its AI advancements.
Adding another layer of complexity, SoftBank is reportedly in talks to lead a $40 billion funding round in OpenAI at a valuation of $300 billion, further elevating the non-profit’s stake in the for-profit entity. Analysts suggest that Musk’s legal battle could set a precedent, potentially delaying or complicating OpenAI’s transition into a full-fledged for-profit organization.
As the AI industry rapidly evolves, Musk’s legal maneuvering spotlights OpenAI’s future. Whether this bid is a strategic play or a genuine effort to preserve OpenAI’s founding principles remains to be seen.
