OpenAI CEO, Sam Altman has rejected a bid of $97.4 billion by a group of investors led by Elon Musk to buy out the ChatGPT maker.
Earlier on Monday, X owner, Elon Musk and other investors submitted a $97.6 billion bid to purchase OpenAI. The bid came amidst a series of fallouts between Musk and Open AI’s Sam Altman, with whom he co-founded OpenAI with numerous other individuals back in 2015.
In response to the offer, Altman authored a sarcastic X post stating: “No thank you but we will buy Twitter for $9.74 billion if you want.”
However, Musk seemingly hit back at Altman by sharing a video on X of Altman’s 2023 testimony before Congress, where he told lawmakers that he owns no equity in OpenAI, with the caption “Scam Altman.”
Elon Musk is already involved in a legal dispute with OpenAI following a 2024 injunction filing against its effort to transition away from its nonprofit profile. The billionaire was involved in the founding of OpenAI as a nonprofit AI research organization and has been attempting to halt Altman’s restructuring plans.
The investor’s team positioned the move as a bid to re-establish OpenAI on open-sourced AI, which was its initial aim.
“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.” Musk’s lawyer, Toberoff, told The Journal.
Musk’s AI firm, xAI, is also involved with the bid, prompting the prediction that a successful acquisition could see the two companies merging. In a related statement, Elon Musk extolled X’s Grok model by citing his strong position on “open source”.
“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,” said Musk.
Elon Musk and investors famously purchased Twitter for $44 billion in 2022.
The billionaire was also in the news as a potential owner of TikTok U.S., which he has refuted. He claimed on the panel that he does not use the short video app personally and is not familiar with its format.
“I’m not chomping at the bit to acquire TikTok, I do not acquire companies in general, it’s quite rare,” Musk said, adding that his billion-dollar acquisition of social media platform Twitter, now called X, was unusual. “I usually build companies from scratch.”
Read More: “I don’t have plans to acquire TikTok”- Elon Musk responds to purchase claims.
Elon Musk-led investors
In what has been described as a potential “hostile takeover” of OpenAI, the investor team offered nearly $97.4 billion to buy all of OpenAI’s assets.
The investors are Baron Capital Group Inc., Valor Management LLC, Atreides Management, LP, Vy Fund III L.P., Emmanuel Capital Management LLC, and Eight Partners VC LLC.
However, Emmanuel Capital Management has a slimmer public profile while others are firmly in Musk’s circle of direct influence.
Baron Capital Group, which manages multiple mutual funds, was founded by Ron Baron. The firm’s Baron Partners Fund, which Baron manages with his son Michael Baron, possesses a large stake in Musk’s Tesla and SpaceX.
Valor Management was founded by Antonio Gracias, an early SpaceX investor and former Tesla board member. He was also an investor in Musk’s SolarCity before Tesla acquired it.
Likewise, Atreides Management is associated with Boston-based hedge fund Atreides. The company’s founder, Gavin Baker, spent 18 years at Fidelity where he made his first investment in SpaceX. Atreides has also invested in Tesla and Baker was a public supporter of Musk’s enormous Tesla pay package.
Founded by Alexander Tamas, Vy Capital also has a SpaceX stake and has invested in a number of other Musk companies like The Boring Company and Neuralink.
Eight Partners VC is better known as Joe Lonsdale’s firm 8VC, according to public dispositions. Lonsdale has always been a vocal fan of Musk and runs in a similar cabal. He recently appeared on CNBC calling himself “a huge fan” of Elon Musk’s DOGE, an interview that Musk reposted on X.
Though the group possesses a strong formidable force, it remains unclear how serious the team is.
In two phases, some analysts suggest this bid was Elon Musk’s attempt to drive up the price that Altman’s team would have to pay to buy OpenAI’s underlying assets in order to restructure it from its original nonprofit status.
The other end felt the bid was as much trolling as the offer.
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