OpenAI board unanimously rejects Elon Musk’s takeover bid

OpenAI says its board of directors has unanimously rejected a 97.4 billion dollar (£77.3 billion) takeover bid by Elon Musk.

“OpenAI is not for sale, and the board has unanimously rejected Mr Musk’s latest attempt to disrupt his competition,” said a statement from Bret Taylor, chairman of OpenAI’s board.

OpenAI lawyer William Savitt, in a letter to Mr Musk’s lawyer on Friday, said the proposal “is not in the best interests of OAI’s mission and is rejected”.

Mr Musk, an early OpenAI investor, began a legal offensive against the ChatGPT maker nearly a year ago, suing for breach of contract over what he said was the betrayal of its founding aims as a non-profit he helped found a decade ago.

Then on Monday, while that case was still awaiting a key ruling, Mr Musk and his own AI start-up, xAI, and a group of investment firms announced a bid to buy the non-profit that controls OpenAI.

Mr Musk in a court filing on Wednesday expanded on the proposal to acquire the non-profit’s controlling stake in the for-profit OpenAI subsidiary.

Mr Savitt’s letter on Friday said that filing added “new material conditions to the proposal. As a result of that filing, it is now apparent that your clients’ much-publicised ‘bid’ is in fact not a bid at all”.

In any event, “even as first presented”, the board has unanimously rejected it, Mr Savitt said.

Mr Musk has alleged in the lawsuit that the companies are violating the terms of his foundational contributions to the charity.

Mr Musk had invested about 45 million dollars (£35.7 million) in the start-up from its founding until 2018, his lawyer has said.

He escalated the legal dispute late last year, adding new claims and defendants, including OpenAI’s business partner Microsoft, and asking for a court order that would halt OpenAI’s plans to more fully convert itself into a for-profit business.

Mr Musk also added xAI as a plaintiff, claiming that OpenAI was also unfairly stifling business competition.

A judge is still considering Mr Musk’s request but expressed scepticism about some of his claims in a court hearing last week.