Musk will drop OpenAI offer if it remains a nonprofit: Lawyers

Tech billionaire Elon Musk will withdraw its bid for OpenAI's non-profit arm if the artificial intelligence firm halts its plans to become a for-profit entity, according to a new court filing.

"If OpenAI, Inc.'s Board is prepared to preserve the charity's mission and stipulate to take the 'for sale' sign off its assets by halting its conversion, Musk will withdraw the bid," Musk's lawyers wrote in a filing on Wednesday.

"Otherwise, the charity must be compensated by what an arms-length buyer will pay for its assets," the filing continued.

A consortium of investors led by Musk submitted a $97.4 billion bid to buy the nonprofit that controls OpenAI earlier this week. The price tag is significantly lower than the company's last valuation of $157 billion and comes amid an ongoing legal battle between Musk and CEO Sam Altman.

Altman quickly poured cold water over the proposal Tuesday, stating "OpenAI is not for sale."

When asked on Bloomberg's "The Pulse" if he takes Musk’s bid seriously, Altman said, “I think he’s probably just trying to slow us down. He obviously is a competitor.”

He also claimed Musk is “not a happy person” in response to a question about whether the world’s wealthiest individual is negotiating from a “place of insecurity.”

“Probably his whole life is from a position of insecurity. I feel for the guy,” Altman said. “I don’t think he’s like a happy person. I do feel for him.”

Musk took a few swipes at the fellow tech billionaire amid the reports this week, calling him a "swindler" and "Scam Altman."

The unsolicited offer marks the latest incident in a years-long feud between Altman and Musk, who helped found OpenAI in 2015.

Musk, who left the artificial intelligence firm in 2018, has an ongoing suit against the company, Altman and Greg Brockman — another OpenAI co-founder alleging the ChatGPT leaders strayed from the company’s roots to pursue profits over benefitting the public good.

The Tesla CEO has taken great issue with Altman and OpenAI’s plans to turn it into a for-profit company and on Monday said that “it’s time for OpenAI to return to the open-source, safety-focused force for good it once was.”

Altman signaled that the non-profit arm of OpenAI "will continue to be extremely important" and "will drive the mission."

"It will continue to exist. The board is looking at lots of options about how to best structure for this next phase, but the nonprofit is not changing in anything or going anywhere," he said.

Reuters reported late Tuesday OpenAI's board had not yet received a formal bid from the investor group, despite Musk's lawyer stating it was sent Monday. The Hill reached out to OpenAI and Musk's legal team for comment.

Regardless of Musk's intentions, the bid is likely to complicate OpenAI's pursuit of a for-profit model, some in the industry told The Hill this week.

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