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Outbyte Driver Updater FREEFix the driver behind crashes, sound loss and screen glitchesFind Drivers →Outbyte PC Repair FREERepair Windows errors before they cause bigger problemsFix Now →Elon Musk, his AI company xAI and a group of investors submitted an unsolicited, all-cash offer of approximately $97.4 billion for OpenAI’s nonprofit-controlled assets or interest on February 10, 2025. OpenAI’s board unanimously rejected the proposal four days later. No acquisition took place.
The bid was more complicated than a conventional offer to buy a company. It arrived during Musk’s lawsuit over OpenAI’s restructuring, amid his rivalry with CEO Sam Altman and competition between OpenAI and Musk’s xAI.
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What happened to Musk’s OpenAI bid?
The proposal was submitted to OpenAI’s board through Musk’s attorney, Marc Toberoff. The offer letter reportedly specified a purchase price of $97.375 billion, commonly rounded to $97.4 billion, with 100% of the consideration payable in cash. It was an unsolicited offer, meaning OpenAI had not asked the consortium to submit it.
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OpenAI’s board rejected the bid unanimously on February 14, 2025, saying the nonprofit was not for sale. The rejection meant the offer never became a transaction, and Musk did not acquire OpenAI.
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The Associated Press reported the original offer, while The Washington Post reported the board’s formal rejection.
What was Musk actually offering to buy?
“Buy OpenAI” is useful shorthand, but it can be misleading. OpenAI was not structured like a single conventional public company.
- OpenAI began as a nonprofit in 2015.
- In 2019, it created a for-profit subsidiary to raise capital and commercialize its research.
- At the time of Musk’s bid, the nonprofit controlled the for-profit activities.
- The consortium described its proposal as an offer for OpenAI’s assets or the nonprofit’s controlling interest.
That distinction matters. The headline did not necessarily mean that Musk would automatically purchase every model, contract, employee relationship, subsidiary or commercial asset associated with OpenAI on ordinary corporate-acquisition terms. The precise scope depended on the offer, OpenAI’s governing documents and the proposed restructuring.
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OpenAI later updated its structure. On October 28, 2025, it said the nonprofit had become the OpenAI Foundation and the for-profit entity had become OpenAI Group PBC, while the foundation retained control. OpenAI’s current description of that structure is available on its official structure page.
Who was behind the offer?
The proposal came from a consortium led by Musk rather than from Musk acting solely as an individual. Reported participants included:
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- xAI, Musk’s artificial-intelligence company;
- 8VC, the venture firm associated with Joe Lonsdale;
- Vy Capital;
- investment vehicles or funds associated with investors including Ron Baron and Gavin Baker; and
- other potential backers discussed in early reporting.
These categories should not be treated as identical. Some people or funds were described as participants, while others were reported as having been approached or considered. Public reporting did not establish that every investor mentioned had made a final financing commitment.
Was it an all-cash offer?
According to the published offer letter, the proposed $97.375 billion purchase price was entirely cash. That describes the form of payment, not the source or certainty of the financing.
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Repair common Windows errors and clear accumulated junk for a smoother, more stable PC - no reinstall needed.Free scan · no reinstallThe bid was made by a consortium, so the wording does not establish that Musk personally had $97.4 billion in immediately available cash or would fund the entire transaction from his own balance sheet. A submitted offer also does not by itself guarantee that financing, due diligence or other closing conditions would be completed.
TechCrunch’s review of the offer letter reported the cash terms and other details of the proposal.
Why did Musk make the bid?
Musk’s stated rationale
Musk said he wanted to return OpenAI to what he described as an open-source, safety-focused organization serving the public good. His legal representative also framed the proposal as a way to ensure that the nonprofit would be fairly compensated if its assets or control were transferred.
Those were Musk’s stated reasons, not an independently established finding about his motives.
The legal and competitive context
The bid came while Musk was challenging OpenAI’s planned move toward a for-profit structure. It also arrived during a long-running dispute between Musk and Altman and as xAI competed with OpenAI for customers, talent, capital and technological influence.
OpenAI argued that Musk’s position was contradictory: he was challenging the transfer of nonprofit assets while simultaneously offering to acquire them. OpenAI also characterized the proposal in its legal filings as an effort to interfere with a competitor. Terms such as “sham bid” or “bad-faith maneuver” are contested characterizations and should be attributed to OpenAI rather than presented as settled facts. OpenAI’s position is reflected in its account of the litigation and its April 2025 court filing.
How did Sam Altman respond?
Altman rejected the proposal almost immediately in a post on X. He wrote that OpenAI would instead buy Twitter for $9.74 billion if Musk wanted to sell it. Musk responded by calling Altman “Swindler.”
Altman’s response was a public executive or personal reaction, not the formal corporate decision. The official rejection came later from OpenAI’s board, which voted unanimously on February 14.
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The exchange was therefore rhetorical rather than a genuine counteroffer for Twitter. The original exchange was reported by AP and The Washington Post.
Why did OpenAI reject the offer?
OpenAI’s board said the nonprofit was not for sale. Its counsel also argued that the proposal did not establish a value for the nonprofit’s assets or interests.
OpenAI’s lawyers connected the offer to Musk’s litigation strategy and argued that his legal claims conflicted with the attempt to purchase the nonprofit-controlled structure. The board’s unanimous vote rejected the proposal, but the available reporting does not support the broader claim that the bid was legally invalid simply because it was made.
The key distinction is between evaluating an offer and accepting it. A large dollar figure did not require the board to approve the transaction, and the board did not conclude that the proposal should proceed.
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1Repair Windows errors before they cause bigger problems2Fix the driver behind crashes, sound loss and screen glitches3Clear out junk files and repair common Windows errorsWhat did the $97.4 billion price mean?
The number was significant, but it was not a clean measure of “OpenAI’s value.”
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| Figure | Date or status | Why the comparison is limited |
|---|---|---|
| $97.375 billion | Offer letter in February 2025 | Concerned the nonprofit-controlled structure or its assets and was proposed by a consortium. |
| $157 billion | Reported valuation from an October 2024 financing round | Reflected a private financing transaction involving a different corporate and investor context. |
| Approximately $300 billion | Reported prospective financing valuation in 2025 | Was a reported future or potential valuation, not a completed transaction at the time of the bid. |
It is reasonable to say that the offer was below OpenAI’s last widely reported private-market valuation. But it is misleading to treat the figures as directly interchangeable. A valuation for an investment in a for-profit entity is not necessarily the same as the value of a nonprofit parent’s assets or controlling rights.
For that reason, a simple calculation claiming that Musk offered a fixed percentage discount to “OpenAI’s value” would overstate what the evidence shows. The target, rights and transaction structure were different.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.Musk said he would withdraw the offer under one condition
On February 12, Musk’s lawyers said he would withdraw the bid if OpenAI’s board agreed to preserve the charity’s mission and abandon the conversion to a for-profit structure.
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Repair Windows errors before they cause bigger problemsFix Now →Scan for outdated or missing drivers - takes under a minuteDriver Scan →This condition is central to understanding the proposal. It indicates that the bid was not simply an unconditional attempt to purchase OpenAI at any price. It was also tied to Musk’s preferred outcome for OpenAI’s governance.
TechCrunch reported the conditional withdrawal.
Timeline: from the bid to OpenAI’s later structure
- February 10, 2025: Musk, xAI and consortium backers submit the unsolicited offer of approximately $97.4 billion.
- February 10, 2025: Altman publicly dismisses the proposal and makes the rhetorical Twitter counteroffer.
- February 12, 2025: Musk’s lawyers say he would withdraw the offer if OpenAI stopped its planned for-profit conversion.
- February 14, 2025: OpenAI’s board unanimously rejects the bid.
- March 4, 2025: A federal judge rejects Musk’s request for a preliminary injunction to pause OpenAI’s restructuring, according to contemporary accounts and OpenAI’s summary.
- May 2025: OpenAI modifies its restructuring plan so nonprofit control remains.
- October 28, 2025: OpenAI announces the Foundation-controlled OpenAI Group PBC structure.
- May 18, 2026: Contemporary coverage reports that a federal court rejected Musk’s lawsuit against OpenAI.
The later restructuring decisions should not be described as being directly caused by Musk’s offer. The bid intensified public, legal and governance scrutiny, but the available sources do not establish that it forced OpenAI to retain nonprofit control.
What the bid did—and did not—mean
It did mean:
- A written offer was formally submitted to OpenAI’s board.
- The reported price was $97.375 billion, rounded to $97.4 billion.
- The consideration was described as 100% cash.
- The offer targeted the nonprofit-controlled OpenAI structure or its assets, not necessarily a conventional purchase of one standalone company.
- The board formally rejected it unanimously.
It did not mean:
- Musk personally had $97.4 billion in cash ready to close the transaction.
- Musk acquired OpenAI or its technology.
- Every investor mentioned in reporting had formally committed funds.
- The offer was proven to be either a sham or a fully executable takeover.
- The bid directly caused OpenAI’s later governance structure.
- Musk’s later litigation outcome proved that the offer was invalid.
Bottom line
Musk’s $97.4 billion proposal was a real, formally submitted offer—but not a completed purchase. It was made by a consortium led by Musk and xAI, focused on OpenAI’s nonprofit-controlled structure, and tied closely to the dispute over OpenAI’s planned restructuring.
OpenAI’s board unanimously rejected it on February 14, 2025. Its lasting importance was less about a change in ownership than about how it exposed the intersection of OpenAI’s unusual governance model, Musk’s lawsuit, the Altman feud and the strategic competition between OpenAI and xAI.
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