OpenAI turns down Musk's takeover bid

OpenAI’s board of directors has turned down Elon Musk’s $97.4 billion bid to buy the nonprofit that controls the artificial intelligence company.

“OpenAI is not for sale, and the board has unanimously rejected Mr. Musk's latest attempt to disrupt his competition,” OpenAI chairman Bret Taylor said in a post on the social platform X on Friday afternoon.

“Any potential reorganization of OpenAI will strengthen our nonprofit and its mission to ensure AGI benefits all of humanity,” he added.

A group of investors led by Musk made the unsolicited bid for OpenAI earlier this week, amid the AI firm’s push to become a for-profit entity. In a court filing Wednesday, the tech billionaire said he would drop the bid if OpenAI halted its for-profit shift.

However, OpenAI CEO Sam Altman made clear early on that he was not entertaining the idea, stating “OpenAI is not for sale.”

“I think he’s probably just trying to slow us down. He obviously is a competitor,” Altman told Bloomberg’s “The Pulse” when asked if he took Musk’s bid seriously.

Musk’s lawyer Marc Toberoff said Friday that he was not surprised OpenAI had rejected the bid but appeared to question whether the board had fulfilled its fiduciary duty to fully consider the offer.

"This comes as no surprise, given that Altman and Board chair, Taylor, already rejected Musk's $ 97.4 billion bid while stating they had not yet received it,” Toberoff said in a statement.

“But we are surprised to see the Board, which has strict fiduciary duties to carefully consider the bid in good faith on behalf of the charity, use the same kind of deflective double-talk Altman used in testifying to the Senate,” he continued.

Toberoff also pushed back on OpenAI’s assertion that it is not for sale amid the for-profit transition.

“Of course they're putting the charity's assets (control of the for-profit enterprise) up for sale,” he said. “That's what their ‘reorganization’ is all about.”

“They're just selling it to themselves at a fraction of what Musk has offered, enriching Board members, Altman, Brockman and others rather than the charity in a classic self-dealing transaction. Will someone please explain how that benefits 'all of humanity'?" he added.

OpenAI announced its plans to restructure the company as a public benefit corporation in late December. The AI firm, which started as a non-profit, currently has a unique structure in which its non-profit controls the for-profit entity.

Musk, who helped found OpenAI in 2015, has repeatedly sued Altman over the past year for allegedly straying from the original mission to develop AI with safety and transparency in mind.

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