In a decisive move, OpenAI’s board of directors has unanimously declined a $97.4 billion acquisition proposal from Elon Musk and his consortium of investors.
The board emphasized its commitment to maintaining OpenAI’s mission and independence.
Background of the Offer
On February 10, 2025, Elon Musk, co-founder of OpenAI and current CEO of xAI, submitted an unsolicited bid to acquire OpenAI.
Musk’s proposal aimed to revert OpenAI to its original non-profit, open-source framework, expressing concerns over the company’s shift towards a for-profit model. He stated intentions to transform OpenAI back into an “open-source, safety-focused force.”
OpenAI’s Firm Response
The board, led by Chairman Bret Taylor, promptly dismissed the offer. In a statement released on February 14, 2025, Taylor asserted, “OpenAI is not for sale, and the board has unanimously rejected Mr. Musk’s latest attempt to disrupt his competition.”
This response underscores OpenAI’s dedication to its mission of ensuring that artificial general intelligence (AGI) benefits all of humanity.
Ongoing Legal Disputes
This bid is the latest development in a series of confrontations between Musk and OpenAI’s leadership. In August 2024, Musk filed a lawsuit against OpenAI, alleging that the organization deviated from its founding non-profit principles by prioritizing profit maximization.
He accused OpenAI of engaging in racketeering and claimed that its transition to a for-profit model contradicted its original mission.
OpenAI has consistently refuted these allegations, suggesting that Musk’s actions are attempts to hinder a competitor.
Financial Implications and Valuation
Analysts have noted that Musk’s offer significantly undervalues OpenAI. In its latest funding round in October 2024, OpenAI was valued at $157 billion, with current internal assessments estimating its worth approaching $300 billion.
This discrepancy indicates that Musk’s bid does not align with OpenAI’s market valuation and future growth prospects.
| Date | Valuation (in billions) |
|---|---|
| October 2024 | $157 |
| February 2025 | ~$300 |
Musk’s Strategic Motivations
Industry experts speculate that Musk’s acquisition attempt may be driven by a desire to realign OpenAI with its original non-profit mission and to integrate its resources with his own AI ventures, including xAI.
However, critics argue that such a move could be perceived as an effort to eliminate competition and consolidate power within the AI sector.
OpenAI’s rejection of Elon Musk’s $97.4 billion offer highlights the organization’s commitment to its foundational mission of developing AGI for the collective benefit of humanity.
Despite external pressures and legal challenges, OpenAI remains steadfast in preserving its autonomy and guiding principles.
FAQs
Why did OpenAI reject Elon Musk’s acquisition offer?
OpenAI’s board unanimously determined that the $97.4 billion bid was not in the best interest of the organization’s mission to ensure AGI benefits all of humanity.
What are the main points of contention between Elon Musk and OpenAI?
Elon Musk has expressed concerns over OpenAI’s shift from its original non-profit, open-source model to a for-profit structure, alleging that this transition contradicts the organization’s founding principles.
How does OpenAI’s current valuation compare to Musk’s offer?
As of February 2025, OpenAI’s internal valuation is approximately $300 billion, significantly higher than Musk’s $97.4 billion bid.