Elon Musk has threatened to pull out of his $97.4 billion offer to purchase the nonprofit organization behind OpenAI if it follows through with its plan to transition into a for-profit entity. In a court filing on Wednesday, Musk’s legal team stated that if OpenAI, Inc.’s board is willing to maintain the nonprofit’s mission and stop the move towards privatization, Musk will withdraw his bid. However, if the transition proceeds, Musk’s lawyers argue that the nonprofit must be compensated according to the market value of its assets, as determined by an independent buyer.
This latest development is part of an ongoing dispute between Musk and OpenAI, a company he helped establish ten years ago. OpenAI is currently controlled by a nonprofit board with the goal of creating safe, advanced AI for the public good. However, after experiencing rapid growth, the company announced plans last year to officially change its structure to a for-profit organization.
Elon Musk, along with his AI company xAI and a group of investment firms, has made an offer to purchase the nonprofit’s controlling interest in the for-profit OpenAI subsidiary.
However, OpenAI’s CEO, Sam Altman, swiftly dismissed the unsolicited offer in a social media post and assured attendees at an AI summit in Paris that the company is not for sale. Bret Taylor, the chair of OpenAI’s board, reinforced this stance during an event on Wednesday.
Elon Musk and Sam Altman co-founded OpenAI in 2015 but later clashed over leadership, leading to Musk resigning from the board in 2018. Since then, the two have been engaged in a long-standing and contentious rivalry.
On Thursday, Musk criticized Altman’s leadership during a video call at the World Governments Summit in Dubai, likening it to a nonprofit designed to protect the Amazon rainforest turning into a lumber company that cuts down trees. Altman has consistently argued that Musk’s legal actions against OpenAI are driven by his competitive interests.
Musk has also asked a federal judge in California to block OpenAI’s transition to a for-profit model, accusing the company of contract violations and potential antitrust issues. While the judge has shown some doubt about Musk’s claims, a decision has not yet been made.