Elon Musk will withdraw his $97.4 billion bid for OpenAI’s nonprofit arm if the ChatGPT maker abandons its plans to become a for-profit entity.
According to Reuters, the billionaire’s lawyers stated this in a court document. They indicate that if OpenAI’s board is willing to preserve the charity’s mission and decides to remove the “for sale” mark from its assets by stopping their conversion, then Musk will withdraw the bid.
If not, the charity should be compensated for what an independent buyer would pay for its assets, the statement states. Musk’s bid was intended to further OpenAI’s charitable mission.
OpenAI and Musk, the CEO of Tesla and social media platform X, did not immediately respond to Reuters’ requests for comment.
In 2015, Sam Altman and Musk jointly founded OpenAI as a charitable organization. However, Musk later left the company due to disagreements with Altman over the company’s direction. Altman subsequently became CEO. He launched a for-profit arm within OpenAI to secure funding from investors such as Microsoft.
Transition to for-profit company
Altman is now working on a plan to transform the core business into a for-profit company that is no longer under the nonprofit board’s control. However, the nonprofit will continue to exist and retain a minority stake in the for-profit company. Musk filed a lawsuit to prevent this transition.
Earlier this week, a Musk-led group offered to take over the nonprofit branch in his latest attempt to block the transition.
Altman told Reuters on Tuesday that the nonprofit is not for sale. OpenAI stated that Musk’s bid conflicts with his lawsuit, in which he claims OpenAI’s assets may not be used for private gain.