Sam Altman rejects Elon Musk’s $97.4 billion unsolicited bid to acquire OpenAI’s nonprofit parent entity, intensifying a feud over the AI giant’s governance. While a detailed four‐page Letter of Intent was reportedly emailed by Musk’s lawyer Marc Toberoff to OpenAI’s outside counsel, the board has not yet (13 February 2025) formally received the bid. The proposal aimed to challenge Altman’s restructuring plans and set a valuation floor for OpenAI’s assets, including ChatGPT.
Sam Altman rejects Musk’s claims that OpenAI has strayed from its original open-source mission, defending its necessary shift toward commercialization. Amid the escalating conflict, Altman fired back—dismissing the bid in a staff letter as a desperate stunt “to slow us down” and noting that Musk hadn’t even submitted an official proposal.
This comes as Altman negotiates a crucial deal with OpenAI’s nonprofit arm—a prerequisite for the company’s transition into a full-fledged entity—estimated at $40 billion. The clash underscores tensions over valuation, nonprofit governance, and regulatory scrutiny as Altman pushes to spin off the nonprofit and secure $40 billion in funding from investors like SoftBank.
Sam Altman Rejects $97.4 Billion Offer – Key Points
Sam Altman Rejects Musk’s Bid and Publicly Mocks Offer:
Altman rejects the bid outright. At an AI summit in Paris, he remarked, “I have nothing to say. I mean, it’s ridiculous,” and internally confirmed that the board would reject the offer to preserve OpenAI’s mission. Previously, he mocked the bid on X, quipping, “No thank you but we will buy Twitter for $9.74B if you want.” Musk, meanwhile, labeled Altman a “Swindler,” escalating the public feud.
Investor Coalition and Legal Tactics:
Musk’s coalition—comprising entities like xAI, Vy Capital, Ari Emanuel, Valor Equity Partners, and Baron Capital Group—faces scrutiny over its intentions. Sam Altman rejects claims of impropriety, emphasizing OpenAI’s independence. Meanwhile, Toberoff noted that whether Altman shared the emailed bid with the full board remains unclear. Concurrently, Musk’s lawsuit alleges that OpenAI’s for-profit transition violates its nonprofit roots, while legal experts stress regulators must ensure fair market value for any transfer of charitable assets.
Valuation Disputes and Strategic Risks:
Analysts project OpenAI could soon be valued around $300 billion, rendering Musk’s offer low. Sam Altman rejects Musk’s valuation critiques by advancing a $40 billion fundraising round alongside a $500 billion Project Stargate infrastructure initiative with Oracle and SoftBank. As negotiations with OpenAI’s nonprofit arm continue—a necessary step before a full corporate transition—the nonprofit, estimated at $40 billion, is unlikely to settle for anything less in future proposals, further complicating the valuation amid regulatory scrutiny.
Leadership Challenges and Industry Rivalry:
Altman’s brief ouster in November 2023—reversed with Microsoft’s backing—underscores internal instability. Musk, who cofounded OpenAI with Altman in 2015 before departing over strategic differences and later launching xAI, leverages his broader business and political clout. His bid adds pressure on Altman’s dual focus on restructuring and Project Stargate, further fueling the OpenAI–xAI rivalry.
Why This Matters:
Sam Altman rejects Musk’s bid not merely as a financial proposition but as a direct challenge to OpenAI’s governance and mission. The standoff highlights broader conflicts between maintaining open-source ideals and embracing commercial scalability in AI development. With regulators—such as Delaware’s Attorney General—scrutinizing OpenAI’s planned transition and ensuring that nonprofit assets fetch fair market value, the dispute could delay critical projects and reshape competition in global AI policy.
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