ET Explainer: Elon Musk-led group offers $97.4 billion to buy Open AI

An Elon Musk-led consortium is offering approximately $97.4 billion to acquire OpenAI, escalating an ongoing legal conflict with the artificial intelligence company Musk once helped establish.

This move is part of Musk's effort to regain control over the ChatGPT creator and steer it back to its original mission as a non-profit research lab that is focused on benefiting the public.

According to his attorney Marc Toberoff, Musk and a coalition of investment firms are determined to take over OpenAI and restore its non-profit status.


In response, OpenAI CEO Sam Altman took to Musk’s social media platform, X, rejecting the proposed acquisition, and jokingly said, "No thank you, but we will buy Twitter for $9.74 billion if you want." Musk responded, calling Altman him a “swindler”. In a separate post, Musk addressed his arch rival as “Scam Altman.”


According to a report by The Information, Altman also informed his staff that the company's board of directors intends to make it clear that it has no interest in Elon Musk's "alleged bid."

"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 said in a statement on Monday, as reported by Reuters.

The legal battle reached a new stage last week when Musk and OpenAI's legal teams squared off in federal court. The judge was asked to consider Musk's request for a court order blocking OpenAI from transitioning into a for-profit company.

US District Judge Yvonne Gonzalez Rogers said it was a "stretch" for Musk to claim that he would suffer irreparable harm if the transition proceeded without court intervention.

However, the judge also raised concerns about OpenAI’s partnership with Microsoft, a significant part of the company’s business strategy. Despite Musk’s efforts to halt the shift to a for-profit model, Judge Gonzalez Rogers indicated that the case would continue toward trial, potentially as early as next year, allowing a jury to determine the outcome.

Musk’s legal action against OpenAI began last year when he first filed a lawsuit in California state court and moved the case to federal court. Musk alleges that OpenAI has strayed from its founding principles as a non-profit research lab aimed at serving the public good. In December, Mark Zuckerberg-led Meta also joined the suit.

According to Musk’s attorney, the billionaire had invested approximately $45 million into the company from its inception in 2015 until his departure from the board in 2018.

Musk cofounded OpenAI with Altman in 2015 to develop artificial intelligence technology in a way that “benefited humanity”.

However, Musk left the organisation before it gained significant momentum, and tensions between the two have escalated since he resigned from the board in 2018. Over the years, the two have been at odds over the startup’s direction, with Musk disagreeing with the company’s shift toward a for-profit model.

In 2023, Musk took another step in the AI sector by launching his competing startup, xAI. This move further fuelled the rivalry between Musk and OpenAI, as both companies vie for dominance in the rapidly evolving landscape.