Open AI CEO Sam Altman and Elon Musk sparred publicly Monday after the Wall Street Journal reported that Musk and other investors have fielded a $97.4 billion offer to take control of the AI giant.
The Journal published a story on the deal Monday. By midday, Altman sent his succinct rejection of the offer in a social media post sent via Musk’s X: “no thank you but we will buy twitter for $9.74 billion if you want.” To which Musk replied: “Swindler.”
The activity demonstrates the growing feud between Altman and Musk, who were both part of a Silicon Valley team of investors and entrepreneurs that founded Open AI as a nonprofit entity in 2015. Open AI and Musk’s various ventures are now working on rival AI services and products. In December, Musk went to federal court to stop Altman’s plan to transform Open AI from a research-focused nonprofit to a more traditional commercial venture. The unsolicited bid revealed Monday is designed to help set a valuation floor for the components of Open AI — including the juggernaut ChatGPT service that the current regime hopes to convert into a commercial venture.
The list of investors working with Musk on the bid included Endeavor CEO Ari Emanuel, in a private capacity. Attorney Marc Toberoff, an entertainment and intellectal property veteran, confirmed to Variety that a bid was submitted. Last month, Toberoff, of Toberoff & Associates, sent a legal letter to officials in California and Delaware who regulate the work of nonprofit organizations urging them to force Open AI to open up the conversion process to outside bidders.
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“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,”
said Toberoff in a statement. “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?”
Musk in a statement suggested that Open AI be merged with his x.AI venture and maintain the open source ethos that was ostensibily infused into Open AI from the start. The $97.4 billion purchase price would go to fund charity and philanthropic efforts by Open AI. Toberoff argued that given his track record with other businesses, “Musk is the person best positioned to protect and grow OpenAI’s technology.”
In a statement Musk reiterated his interest in gaining control of Open AI’s tech platforms and R&D.
“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,” said Musk. “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.”
The growing fracas over the future of Open AI, which has had heavy investment from Microsoft but recently touted at the Trump White House a new $500 billion AI investment venture Stargate at the White House with Larry Ellison’s tech giant Oracle and Masayoshi Son’s investment behemoth SoftBank. Musk has suggested via social media comments that the partners don’t have the money on hand to fund it at the promised “up to” $500 billion level, among other remarks.
Musk, the owner of Tesla and SpaceX in addition to X, at present ranks as the world’s wealthiest individual. He’s gained immense power and clout in the federal government since President Donald Trump’s inauguration on Jan. 20, making him an even more formidable combatant in business. He leads the White House-based Department of Government Efficiency, which is designed to shrink the size of the federal government and cut federal spending. Amid the flurry of activity in the first three weeks of the Trump administration, some of Musk’s efforts, including his bid to pause key Treasury Department payment schedules and target federal workers from buyouts and termination have been blocked by legal challenges. On Sunday, Trump said Musk’s next focus would be rooting out fraud in the Department of Education and the military.
Altman has been the tech and business visionary driving Open AI to innovations in generative AI since the venture began. But his hold on the company might have loosened a bit in the past 18 months after he was abruptly ousted as CEO by the Open AI’s nonprofit board in November 2023. He was reinstated four days later amid a revolt by core Open AI staff and after Altman received Microsoft’s public vote of confidence.
(Pictured: Open AI CEO Sam Altman, Elon Musk)