Elon Musk's consortium has made a $97.4 billion offer to acquire the nonprofit controlling OpenAI, escalating his battle to prevent the AI company from becoming for-profit. This move comes amid tensions between Musk and OpenAI CEO Sam Altman over the company's future. Musk, who co-founded OpenAI but left before its rise, argues that it has strayed from its original mission of public good and now prioritizes profit. He aims to return OpenAI to its open-source roots and prevent its transition to a for-profit structure. The offer complicates OpenAI's fundraising efforts and its planned conversion, potentially forcing the board to consider a less lucrative deal.
DeepSeek stirs up kimchi feud and privacy concerns as S. Korea spy agency demands access block to China’s AI app over ‘excessive’ data breachA consortium led by Elon Musk said yesterday it has offered US$97.4 billion to buy the nonprofit that controls OpenAI, another salvo in the billionaire’s fight to block the artificial intelligence startup from transitioning to a for-profit firm.
OpenAI is now trying to transition into a for-profit from a nonprofit entity, which it says is required to secure the capital needed for developing the best AI models. “It’s time for OpenAI to return to the open-source, safety-focused force for good it once was,” Musk said in a statement yesterday. “We will make sure that happens.”“Musk’s bid puts another wrinkle into OpenAI’s quest to remove the nonprofit’s control over its for-profit entity,” said Rose Chan Loui, executive director of the UCLA Law Centre for Philanthropy and Nonprofits.
XAI could merge with OpenAI following a deal, according to the Wall Street Journal which first reported Musk’s offer earlier on Monday. XAI recently raised US$6 billion from investors at a valuation of US$40 billion, sources have told Reuters.“This is definitely throwing a wrench in things,” said Jonathan Macey, a Yale Law School professor specialising in corporate governance.
Musk’s stock in Tesla is valued at roughly US$165 billion, according to LSEG data, but his leverage with banks is likely to be thin after his US$44 billion buyout of what was then called Twitter in 2022.
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