Elon Musk launched a $97.4 billion bid to acquire OpenAI, reigniting his feud with CEO Sam Altman. Musk's move, supported by investors including x.AI, seeks to control the influential AI research company amid a debate over its for-profit transition.
Elon Musk and Sam Altman clashed on X (formerly Twitter ) on Monday over Musk's $97.4 billion bid to gain control of OpenAI. Musk, along with a group of investors including his AI company, x.AI, submitted the unsolicited offer to the OpenAI board. Marc Toberoff, a lawyer representing the group, confirmed the offer, stating that it encompassed 'all assets' of OpenAI, Inc. Musk asserted in the statement, 'At x.AI, we live by the values I was promised OpenAI would follow.
We've made Grok open source, and we respect the rights of content creators. It's time for OpenAI to return to the open-source, safety-focused force for good it once was. We will make sure that happens.' OpenAI was valued at $157 billion during a funding round in October 2023, raising $6.6 billion. Earlier reports in January 2024 indicated that SoftBank, a Japanese investment holding company, was poised to invest in OpenAI, potentially valuing the company at around $300 billion. The investor group, which includes Baron Capital Group, Inc., Valor Management LLC, Atreides Management, LP, Vy Fund III, L.P., Emanuel Capital Management, LLC, and Eight Partners VC, LLC, aims to acquire the OpenAI nonprofit, which currently holds the control over the rest of OpenAI. Altman favors converting the startup into a for-profit entity, but this necessitates fair compensation for the charitable arm's assets. Determining a fair market value for these assets presents a complex challenge. The Musk-led group maintains that their bid for OpenAI ensures a fair valuation of the charitable arm's assets and appropriate payment prior to any transition to a for-profit structure. Toberoff stated, 'As we understand the OpenAI, Inc. Board's present intentions, they will give up majority ownership and control over OpenAI's entire for-profit business in exchange for some minority share of a new, consolidated for-profit entity. Who on Earth would make that trade?' He further argued, 'If the Board is determined to relinquish OpenAI, Inc.'s assets, it is in the public's interest to ensure that OpenAI, Inc. is compensated at fair market value. That value cannot be determined by insiders negotiating on both sides of the same table.' Following the news of the bid, Altman appeared to respond on X, tweeting, 'no thank you but we will buy twitter for $9.74 billion if you want.' Musk retorted with, 'Swindler.' Musk also labeled Altman as 'Scam Altman' on X. Representatives for OpenAI did not respond to requests for comment.The history between Altman and Musk highlights their contrasting views on OpenAI's direction. They co-founded OpenAI as a non-profit in 2015, but Musk departed in 2018 and has since publicly criticized both Altman and OpenAI. Musk's primary criticism centers on OpenAI's decision to transition to a for-profit structure. Announced in September 2023, this move aims to secure more funding and ensure OpenAI's long-term sustainability. Musk's $97.4 billion bid adds a significant twist to this ongoing saga. The outcome of this bid could potentially alter OpenAI's trajectory and shape the future of artificial intelligence.
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