Elon Musk Launches $97.4B Hostile Takeover Bid for OpenAI, Sparking Tech Industry's Biggest Power Struggle

In a move that could dramatically reshape the artificial intelligence landscape, Elon Musk is leading a group of investors in a $97.4 billion bid to acquire OpenAI, the company behind the popular ChatGPT.

The audacious bid, first reported in the Wall Street Journal, represents a significant premium over OpenAI’s recent valuations, reflecting the intense competition and strategic importance of the AI industry. If successful, some speculate this Elon Musk OpenAI buyout would be one of the largest tech buyouts in history.

Musk, a co-founder of OpenAI in 2015, has since left the company following disagreements about its direction, including a shift towards a for-profit model. He has consistently voiced concerns about the risks of unchecked AI.

“If Sam Altman and the present OpenAI, Inc. Board of Directors are intent on becoming a fully for-profit corporation, it is vital that the charity be fairly compensated for what its leadership is taking away from it: control over the most transformative technology of our time,” said Marc Toberoff, an attorney representing the investors, in a statement. “It’s time for OpenAI to return to the open-source, safety-focused force for good it once was. We will make sure that happens.”

OpenAI CEO Sam Altman said in a post on X, “no thank you but we will buy twitter for $9.74 billion if you want.” This pointed response highlights the deep personal animosity between the two tech leaders.

The conflict between Musk and Altman has escalated into legal battles. Musk has filed a number of legal complaints against the company and Altman, claiming that the AI company and its leadership have misrepresented OpenAI as a philanthropy, and that OpenAI broke with its founding charter by seeking profit.

Musk filed a new lawsuit in August 2024 accusing OpenAI of racing to develop powerful “artificial general intelligence” technology to “maximize profits” and engaging in racketeering.

OpenAI was founded in 2015 on the principle that artificial general intelligence (AGI) should benefit all of humanity, emphasizing open-source research and prioritizing safety. Its creators believed AGI posed a serious threat to humanity.

The organization transitioned to a “capped-profit” model, OpenAI LP, in 2019. This entity allows the company to attract investment and offer competitive salaries.

This transition, however, sparked controversy and is a central issue in Musk’s lawsuit, as it allows OpenAI to partner with big backers like Microsoft, and venture capital firm Thrive Capital. These backers want the company to grow it’s business and make money.

In a bizarre board room battle in late 2023, the OpenAI board fired Altman before quickly rehiring him. The board has since been reshaped, with former directors saying they were concerned OpenAI was moving too quickly without regard for safety.

Rumors of an Elon Musk attempt to buy OpenAI are fueled by his desire to steer the course of AI development towards his vision of transparency, open-source principles, and a cautious approach. His own AI venture, xAI, founded in 2023, and its chatbot, Grok, intensified the competition between Musk and OpenAI.

Following Altman’s rejection of the Elon Musk offer for OpenAI, Musk’s next steps are unclear. He could explore alternative strategies, continue developing xAI, or pursue further litigation.

The attempted buyout and ongoing tension between Musk and Altman have raised crucial questions about artificial intelligence governance and the future of open-source versus closed-source AI development. OpenAI’s ChatGPT saw a surge in usage and hit 3.8 billion visits in January 2025.