Sam Altman says ‘no thank you’ to Elon Musk’s OpenAI bid

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A group of investors led by Elon Musk has offered to buy the nonprofit that controls OpenAI for US$97.4 billion, escalating a clash between the Tesla Inc. chief executive and the artificial intelligence company he co-founded.

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With the unsolicited bid, Musk said he hopes to return OpenAI to being “the open-source, safety-focused force for good it once was,” according to a statement. In response, Sam Altman posted on Musk’s X social-media platform: “No thank you but we will buy twitter for $9.74 billion if you want.” (Musk acquired Twitter for US$44 billion, but its value later diminished, according to outside estimates.)

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The Wall Street Journal was first to report the offer. OpenAI formally declined to comment. Toberoff didn’t immediately respond to a request for comment.

The bid is being backed by Musk’s own AI startup xAI, which could merge with OpenAI following a deal, the Journal said, as well as investors including Valor Equity Partners, Baron Capital, Atreides Management, Vy Capital and 8VC, a venture firm led by Palantir co-founder Joe Lonsdale, and Ari Emanuel through his investment fund. Lonsdale declined to comment. The rest of the named investors didn’t immediately respond to requests for comment.

Musk and Altman have been locked in a long-standing feud for years over the direction that the AI company has taken since its founding. Musk has alleged that OpenAI has abandoned all pretense of proceeding as a charity to benefit humanity with a focus on openness and safety.

The company is actively working to transition from its nonprofit roots in 2015 — when Musk and Altman worked together as founders — to a for-profit company, following billions of dollars in outside investment by Microsoft Corp. and others.

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In a revised version of a lawsuit that he originally filed in August, Musk called OpenAI’s partnership with Microsoft a “monopoly” that is “actively trying to eliminate competitors, such as xAI, by extracting promises from investors not to fund them.” The revised suit lists 26 legal claims and runs 107 pages, compared with 15 claims in the 83-page original complaint.

Microsoft’s US$13 billion investment in OpenAI has raised concerns from the United States Federal Trade Commission that the tech giant could extend its dominance in cloud computing into the booming AI market. The Japanese investment firm SoftBank Group Corp., however, is in talks to invest as much as US$25 billion in OpenAI, a move that would potentially eclipse all other stakes and make it the startup’s biggest backer. The investment could value OpenAI at US$300 billion, Bloomberg has reported.

Last month, Microsoft altered its multiyear deal with OpenAI, allowing the startup to use cloud-computing services from rival providers, so long as the software giant doesn’t want the business itself. The restructured deal coincided with an announcement by OpenAI, Softbank and Oracle Corp. of a new US$500 billion joint venture to build cloud computing data centres in the U.S., dubbed Stargate.

Bloomberg.com

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