OpenAI refuses Musk bid of nearly $100 billion – Techzine Europe
OpenAI is not accepting a possible nearly $100 billion bid that Elon Musk and other investors have made for the AI startup. The reason for the bid would be that Musk would want OpenAI’s LLMs to become open-source again.
The $97.4 billion bid for OpenAI was announced yesterday by business newspaper the Wall Street Journal. Besides Tesla, SpaceX, X, Neurolink owner and Trump confidant Elon Musk, the bid is backed by his own AI company xAI, several investment funds, including Valor Equity Partners, Baron Capital, Atreides Management, Vy Capital, 8VC of Palantir co-founder Joe Lonsdale and the investment fund of Ari Emanuel, CEO of Endeavor.
According to the lawyer for these investors, OpenAI needs to make its models open-source again and focus more, as before, on secure AI development. And these investors are going to take care of that regardless, the lawyer threatens. Ultimately, the acquisition should lead to a possible merger between xAI and OpenAI.
The consortium is willing to go all out and perhaps outbid its own bid. Early this year, the investors had already sent a letter to the responsible authorities in the states of California and Delaware asking whether they would allow open bids for the AI giant.
In an initial response on Musk’s social media platform, CEO Sam Altman immediately let it be known that a takeover is not going to happen. Instead, he “taunts” Musk that with the 9.74 billion OpenAI might well buy “Twitter,” the former name of the X platform.
Elon Musk is among the original founders of OpenAI, but left the startup in 2019. Sam Altman then became CEO. For some time, Musk and OpenAI have been embroiled in a lawsuit over the direction the AI giant should take.
The commercial arm of OpenAI, which was used for investments by Microsoft and other companies, Altman wants to transform it into a normal commercial company. In the process, the non-profit branch would be spun off and eventually house the shares for the “normal” commercial company.
The feud between Musk and Altman revolves mainly around the value of the nonprofit branch. After all, whoever has the most shares in it ultimately controls OpenAI’s commercial operations.
The AI tech giant has been in talks with various investors for some time to determine the value of the company and how many shares they would receive in the new commercial company before the transition. Musk’s bid only increases the value, so it needs to raise more money to financially compensate investors from the nonprofit branch.
Elon Musk’s bid could also potentially create problems for the recent Stargate deal of as much as $500 billion that OpenAI recently struck with the Trump administration. Under this deal, the AI giant will invest in building AI data centers in the US.
For these investments, it is obviously also very important to know the value of (the new) OpenAI. Elon Musk, who was not involved in the deal, immediately indicated that OpenAI did not have the money for this to realize this plan.
Also read: Musk again challenges OpenAI profitability
Elon Musk / feud / OpenAI / takeover bid
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Techzine focusses on IT professionals and business decision makers by publishing the latest IT news and background stories. The goal is to help IT professionals get acquainted with new innovative products and services, but also to offer in-depth information to help them understand products and services better.
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All rights reserved.
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This article was autogenerated from a news feed from CDO TIMES selected high quality news and research sources. There was no editorial review conducted beyond that by CDO TIMES staff. Need help with any of the topics in our articles? Schedule your free CDO TIMES Tech Navigator call today to stay ahead of the curve and gain insider advantages to propel your business!
The $97.4 billion bid for OpenAI was announced yesterday by business newspaper the Wall Street Journal. Besides Tesla, SpaceX, X, Neurolink owner and Trump confidant Elon Musk, the bid is backed by his own AI company xAI, several investment funds, including Valor Equity Partners, Baron Capital, Atreides Management, Vy Capital, 8VC of Palantir co-founder Joe Lonsdale and the investment fund of Ari Emanuel, CEO of Endeavor.
According to the lawyer for these investors, OpenAI needs to make its models open-source again and focus more, as before, on secure AI development. And these investors are going to take care of that regardless, the lawyer threatens. Ultimately, the acquisition should lead to a possible merger between xAI and OpenAI.
The consortium is willing to go all out and perhaps outbid its own bid. Early this year, the investors had already sent a letter to the responsible authorities in the states of California and Delaware asking whether they would allow open bids for the AI giant.
In an initial response on Musk’s social media platform, CEO Sam Altman immediately let it be known that a takeover is not going to happen. Instead, he “taunts” Musk that with the 9.74 billion OpenAI might well buy “Twitter,” the former name of the X platform.
Elon Musk is among the original founders of OpenAI, but left the startup in 2019. Sam Altman then became CEO. For some time, Musk and OpenAI have been embroiled in a lawsuit over the direction the AI giant should take.
The commercial arm of OpenAI, which was used for investments by Microsoft and other companies, Altman wants to transform it into a normal commercial company. In the process, the non-profit branch would be spun off and eventually house the shares for the “normal” commercial company.
The feud between Musk and Altman revolves mainly around the value of the nonprofit branch. After all, whoever has the most shares in it ultimately controls OpenAI’s commercial operations.
The AI tech giant has been in talks with various investors for some time to determine the value of the company and how many shares they would receive in the new commercial company before the transition. Musk’s bid only increases the value, so it needs to raise more money to financially compensate investors from the nonprofit branch.
Elon Musk’s bid could also potentially create problems for the recent Stargate deal of as much as $500 billion that OpenAI recently struck with the Trump administration. Under this deal, the AI giant will invest in building AI data centers in the US.
For these investments, it is obviously also very important to know the value of (the new) OpenAI. Elon Musk, who was not involved in the deal, immediately indicated that OpenAI did not have the money for this to realize this plan.
Also read: Musk again challenges OpenAI profitability
Elon Musk / feud / OpenAI / takeover bid
"*" indicates required fields
At Appian, they are steadily building on the Automation Platform. Eve…
Business intelligence seems almost indispensable in a modern organiza…
Apple has reportedly been ordered by the British government to create a backdoor that lets security services …
Matt Mullenweg, co-founder of WordPress, posted a statement on X reporting that Joost de Valk would no longer…
A detained ex-employee of both chip machine builder ASML and chipmaker NXP is said to have ties to the Russia…
Discover the essential strategies and imperatives to create a data an…
Some companies thrive in times of external uncertainty. They know how…
The IT department is currently under great pressure, partly because o…
As the software development life cycle becomes ever more complex and …
Techzine focusses on IT professionals and business decision makers by publishing the latest IT news and background stories. The goal is to help IT professionals get acquainted with new innovative products and services, but also to offer in-depth information to help them understand products and services better.
© 2025 Dolphin Publications B.V.
All rights reserved.
source
This article was autogenerated from a news feed from CDO TIMES selected high quality news and research sources. There was no editorial review conducted beyond that by CDO TIMES staff. Need help with any of the topics in our articles? Schedule your free CDO TIMES Tech Navigator call today to stay ahead of the curve and gain insider advantages to propel your business!
