WASHINGTON: Elon Musk will withdraw a $97.4 billion offer to buy OpenAI if its board of directors returns the artificial intelligence pioneer to a non-profit “charity” model, according to court documents filed on Wednesday.
Musk made an offer to buy the ChatGPT creator on Monday, the Wall Street Journal reported, but Chief Executive Sam Altman swiftly turned it down, saying OpenAI was “not for sale”. The filing states: “If OpenAI, Inc’s Board is prepared to preserve the charity’s mission and stipulate to take the “for sale” sign off its assets by halting its conversion, Musk will withdraw the bid.
“Otherwise, the charity must be compensated by what an arms-length buyer will pay for its assets.” OpenAI currently operates a hybrid structure, as a non-profit with a money-making subsidiary.
The change to a for-profit model -- one that Altman considers crucial for the company’s development -- had exacerbated ongoing tensions with Musk. Musk and Altman were among the 11-person team that founded OpenAI in 2015, with the former providing initial funding of $45 million.
Three years later, Musk departed the company, with OpenAI citing “a potential future conflict for Elon... as Tesla continues to become more focused on AI”. The massive costs of designing, training and deploying AI models have forced the company to seek a new corporate structure that would give investors equity and provide more stable governance.