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Elon Musk said he would withdraw his $97.4 billion bid for the nonprofit that controls OpenAI if the board stopped its conversion to a for-profit company.
“If [the] OpenAI board is prepared to preserve the charity’s mission and stipulate to take the ‘for sale’ sign off its assets by halting its conversion, Musk will withdraw the bid,” lawyers for Musk said in a court filing Wednesday.
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OpenAI is already on its way to becoming a for-profit company, which it has said it needs to do to keep raising capital to develop advanced artificial intelligence.
It told investors who put $6.6 billion into an October funding round that they could take back their money if the conversion wasn’t complete in two years. The ChatGPT developer and its biggest backer, Microsoft, have hired investment banks to negotiate how the tech giant’s prior investments should be converted to equity in a for-profit.
An OpenAI spokesman declined to comment.
After Musk made his bid Monday, OpenAI chief executive Sam Altman and chairman Bret Taylor said they weren’t interested in selling. In a court filing Wednesday, OpenAI said Musk’s offer, which is backed by private equity and venture firms, demonstrates that his attempts in court to force the company to remain a nonprofit aren’t genuine.
“Musk would have OpenAI, Inc. transfer all of its assets to him, for his economic
benefit and that of his competing AI business and hand-picked private investors,” OpenAI attorneys wrote in the filing.
Musk’s unsolicited offer has complicated a critical issue in OpenAI’s for-profit conversion: how to value the nonprofit that currently controls the company but is set to be spun out into an independent charity. As it seeks approval for that plan from the attorneys general in California, where it is based, and Delaware, where it is incorporated, OpenAI may face pressure to value the nonprofit at or above the $97.4 billion Musk offered.
The uncertainty around Musk’s offer could also make it more difficult for OpenAI to raise funds for Stargate, a joint venture with SoftBank and other partners to spend up to $500 billion on AI infrastructure over the next four years.
Musk’s move for control of OpenAI is the latest in a series of legal salvos he has launched against his former friend Altman and the company they co-founded