Musk-Led Group Seeks to Buy OpenAI for $97.4B

A group of investors led by Elon Musk is offering about $97.4 billion for OpenAI, escalating a legal dispute with the artificial intelligence company that Musk helped found. Musk—who has his own AI startup, xAI—and a consortium of investment firms want to take control of the ChatGPT maker and revert it to its original charitable mission as a nonprofit research lab, according to Musk's attorney Marc Toberoff. OpenAI CEO Sam Altman quickly rejected the deal in a post on X, saying, "no thank you but we will buy Twitter for $9.74 billion if you want." Musk bought Twitter, now called X, for $44 billion in 2022.

Musk and Altman, who together helped start OpenAI in 2015 and later competed over who should lead it, have been in a long-running feud over the startup's direction since Musk resigned from its board in 2018, the AP reports. Musk, an early OpenAI investor and board member, sued the artificial intelligence 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 said in court last week. Musk is seeking a court order to block the ChatGPT maker from converting itself to a for-profit company.

Toberoff said the consortium will match or exceed any higher bids, the Wall Street Journal reports. "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," he said in a statement. Along with Musk and xAI, others backing the bid include Baron Capital Group, Valor Management, Atreides Management, Vy Fund, Emanuel Capital Management, and Eight Partners VC. (More OpenAI stories.)