Elon Musk Threatens to Withdraw $97.4 Billion OpenAI Bid if Nonprofit Status is Preserved

Elon Musk lawyer has stated that the billionaire will withdraw his $97.4 billion bid for OpenAI nonprofit if its board halts its transition to a for-profit company and preserves its original charitable mission.

Musk’s Offer and OpenAI’s Response

Musk’s legal team filed a statement in the U.S. District Court for the Northern District of California, confirming that the offer is serious and must reflect fair market compensation.

The filing states:

“Should the charity’s assets proceed to sale, a Musk-led consortium has submitted a serious offer that would go to the charity in furtherance of its mission.”

However, if OpenAI reverses its for-profit shift, Musk is willing to withdraw the bid.

OpenAI’s board, led by CEO Sam Altman, rejected Musk’s unsolicited proposal, with legal counsel Andy Nussbaum arguing that OpenAI nonprofit “is not for sale.”

Musk’s Legal Battle Against OpenAI

Musk, a co-founder of OpenAI, sued the company in 2023, alleging anticompetitive behavior and fraud.

OpenAI initially launched as a nonprofit, but in 2019, it adopted a “capped-profit” structure with its nonprofit entity still controlling the corporation. OpenAI is now transitioning again—this time to a public benefit corporation.

Musk’s lawsuit seeks to block this move, arguing that it violates OpenAI’s founding principles.

OpenAI’s Counterargument

In a separate legal filing, OpenAI’s attorneys dismissed Musk’s bid as an attempt to undermine a competitor. They argued that Musk’s offer contradicts his legal stance, as he previously claimed that transferring OpenAI’s assets would breach its charitable mission.

Musk’s latest move escalates the battle for OpenAI’s future, raising questions about corporate governance, AI development ethics, and market competition.