Elon Musk has made a bold move to take over OpenAI, setting a May 10 deadline for the company to accept or reject his offer. According to a recently filed letter of intent, Musk and a group of investors have proposed a $97.375 billion all-cash deal to acquire OpenAI’s operating assets. The filing, submitted in a California federal court on Wednesday, outlines Musk’s demand for complete access to OpenAI’s financial records, assets, and personnel as part of the due diligence process.
This is the first official confirmation of Musk’s hostile takeover bid, initially revealed earlier this week. While OpenAI CEO Sam Altman swiftly dismissed the offer in a tweet, OpenAI’s board has yet to respond formally.
Musk’s takeover plan: A cash-only deal with no debt financing
Musk’s acquisition offer comes with an unusual promise—100 percent of the purchase price will be paid in cash without needing third-party debt financing. The investor group backing Musk includes Baron Capital Group, Valor Management, Atreides Management, Vy Fund III, Emanuel Capital Management, and Eight Partners VC.
The letter clarifies that Musk’s team wants unrestricted access to OpenAI’s business operations before finalizing the deal. This includes a deep dive into financial projections, revenue growth, EBITDA, and a complete examination of OpenAI’s facilities, equipment, books, and internal records.
A legal battle with OpenAI intensifies.
The timing of Musk’s takeover bid adds fuel to an already heated legal battle between him and OpenAI. Musk, who co-founded OpenAI before parting ways in 2018, is currently suing the company, alleging that it has strayed from its original mission of developing AI for the benefit of humanity. OpenAI’s lawyers have countered by arguing that Musk is attempting to undermine the company to boost his AI venture, xAI.
OpenAI’s legal team has pointed to the letter as further proof that Musk’s real intention is to destabilize OpenAI rather than engage in a fair acquisition process. The company has not officially responded to the offer beyond Altman’s social media rejection.
Will OpenAI accept Musk’s offer?
As stated in the letter, the $97.4 billion valuation of OpenAI is based on historical financial results and projections available to Musk’s team. However, the final price remains negotiable depending on further due diligence.
At this stage, OpenAI has three options—accept the deal, formally reject it, or negotiate a way to walk away. Given the existing tensions between Musk and OpenAI’s leadership, the situation will likely escalate further in the coming months. Whether Musk manages to take control or OpenAI successfully defends its independence, this takeover battle will be one of the most dramatic showdowns in the AI industry.
