OpenAI's board of directors on Friday rejected a $97.4 billion quote by Elon Musk and a consortium of financiers to acquire control of the expert system business, deepening a fight between Mr. Musk and OpenAI's president, Sam Altman.
In a statement, Bret Taylor, the chairman of the OpenAI board, said, “OpenAI is not for sale, and the board has actually unanimously rejected Mr. Musk's latest attempt to interrupt his competition.” Mr. Taylor was referring to Mr. Musk's own A.I. company, xAI.OpenAI sent
a letter on Friday to Marc Toberoff, the lawyer representing Mr. Musk and the investors making the quote, stating the offer was “not in the very best interests of OAI's mission,” which is to develop expert system that benefits “all of humankind.”
Mr. Musk and other investors made their deal on Monday for the possessions of the not-for-profit that controls OpenAI. With the bid, Mr. Musk was meddling in a strategy that Mr. Altman has made to alter OpenAI's corporate structure. Mr. Altman wishes to shift control of the company to OpenAI's investors, including Microsoft.Mr.
Toberoff said in a declaration to The New York Times: “This comes as not a surprise, given that Altman and board chair Taylor already declined Musk's $97 billion quote while specifying they had actually not yet received it. However we are amazed to see the board, which has strict fiduciary duties to thoroughly think about the quote in good faith on behalf of the charity, use the exact same sort of deflective double-talk Altman utilized in affirming to the Senate.”
Mr. Toberoff firmly insisted that OpenAI was undoubtedly putting the not-for-profit's possessions up for sale. “They're just selling it to themselves at a portion of what Musk has offered, improving board members,” he stated, “rather than the charity in a classic self-dealing deal.” He included, “Will someone please discuss how that advantages ‘all of humankind'?”
Mr. Musk did not instantly respond to an ask for comment.Mr.
Musk and Mr. Altman have actually been at odds for years. Mr. Musk helped produce OpenAI as a not-for-profit in 2015, along with Mr. Altman and others. In 2018, Mr. Musk left the company after a battle for control of the company. Mr. Altman then connected OpenAI to a for-profit business so he could raise the billions of dollars needed to develop A.I. technologies.The nonprofit, though,
retained control of the business. Last year, Mr. Altman and his colleagues started working on a plan to shift control of the company from the nonprofit to OpenAI's investors.Mr. Musk's$97.4 billion quote could make complex that plan. To separate OpenAI from the nonprofit board, Mr. Altman and his allies need to compensate it
. OpenAI might pay the not-for-profit a one-time cost, for instance, or provide it a minority stake in the company.But the nonprofit's assets have actually not been provided a worth, which was what Mr. Musk was trying to develop with his bid. His offer implied that OpenAI's for-profit arm would have to spend more to acquire self-reliance from the nonprofit.Mr. Musk also submitted a lawsuit in federal court last year to obstruct OpenAI's strategies to restructure.Robert Bonta, California's chief law officer and a Democrat, stated this week in an interview that the state was scrutinizing OpenAI's plan to move to a for-profit structure. “There's a method to do it right.
There's a method to do it wrong, and we're keeping an eye on to ensure they do it right,” he stated, adding that his office was likewise carefully watching Mr. Musk.We are”monitoring everything
he does, “Mr. Bonta said.As Mr. Musk battles OpenAI, he is likewise raising cash for xAI. The start-up, which makes a chatbot called Grok, is in talks for a new financing round that might value it
at as much as$75 billion, up from about $40 billion just 2 months earlier, two individuals with understanding of the discussions said.The talks remain in the early phases, they stated, and it's uncertain how much cash will be raised. Bloomberg earlier reported the talks.As recently as December, xAI had raised $6 billion, saying it would use the money to develop infrastructure and accelerate research and
advancement. BlackRock, Fidelity, Sequoia Capital and others financiers participated in the funding. (The Times has actually taken legal action against OpenAI and Microsoft for copyright infringement of news material related to A.I. systems. OpenAI and Microsoft have rejected those claims.)Source
