The ongoing power struggle between two of the biggest names in artificial intelligence, Elon Musk and Sam Altman, took another dramatic turn as the OpenAI chief executive rejected a $97.4 billion (£78.4 billion) takeover bid from a consortium led by Musk. The offer, which aimed to acquire all assets of the AI powerhouse behind ChatGPT, was submitted to OpenAI’s board on Monday, according to Musk’s attorney, Marc Toberoff.

Image courtesy: Maryna Linchevska / Shutterstock.com

Altman swiftly dismissed the bid with a pointed response on Musk’s own social media platform, X (formerly Twitter), saying: “No thank you, but we will buy Twitter for $9.74 billion if you want.” His response underlines the tense and often contentious relationship between the two tech moguls, whose history dates back to OpenAI’s founding in 2015.

A Battle for OpenAI’s Future

While Altman’s rejection may seem definitive, the fate of OpenAI is not solely in his hands. The company’s board retains significant influence over strategic decisions, including a potential sale. If Musk and his consortium increase their offer, the board could weigh a takeover more seriously.

There are also lingering doubts about Musk’s true intentions. Some industry analysts view the bid as part of an ongoing legal dispute between Musk and OpenAI rather than a genuine acquisition effort. Musk, who helped co-found OpenAI as a nonprofit, has been highly critical of Altman’s leadership, accusing him of deviating from the original mission of developing AI for the benefit of humanity. OpenAI has since transitioned into a for-profit company, a move that Musk has condemned.

Valuation Discrepancy Raises Questions

Musk’s $97.4 billion offer is significantly lower than OpenAI’s estimated valuation. In October 2024, the company was valued at $157 billion, and recent talks regarding a new funding round suggest that figure could now be as high as $300 billion. In response to concerns about the undervaluation, Toberoff stated that Musk’s consortium is “prepared to consider matching or exceeding” any potential higher bid.

Christie Pitts, a San Francisco-based tech investor at Panasonic Well, expressed scepticism about Musk’s bid. “I think it’s fair to be pretty suspicious of this considering that he has a competitor himself… which is structured as a for-profit company. So I think there’s more than meets the eye here,” she told the BBC.

The AI Arms Race and The Stargate Project

Amid the battle for OpenAI, Altman’s company is also embarking on an ambitious initiative known as The Stargate Project, a massive AI infrastructure venture. OpenAI has partnered with Oracle, a Japanese investment firm, and an Emirati sovereign wealth fund to build $500 billion worth of AI infrastructure in the U.S.

The project was officially announced at the White House by U.S. President Donald Trump, who called it “the largest AI infrastructure project by far in history.” Trump emphasized the importance of keeping “the future of technology” within the United States, aligning with growing concerns over AI development and global competition.

Musk, despite being a close advisor to Trump, has cast doubt on the project, claiming that it does not “actually have the money” it has pledged to invest. However, he has yet to provide concrete evidence to support this assertion.

What’s Next for OpenAI?

With tensions running high, the future of OpenAI remains uncertain. Musk’s bid may not be the final chapter in this saga, as he could return with a higher offer or take alternative measures to challenge OpenAI’s direction. Meanwhile, Altman continues to focus on OpenAI’s growth and its strategic projects, positioning the company as a central player in the AI revolution.

As the battle between two of the most influential figures in tech unfolds, the outcome will shape not only OpenAI’s future but also the broader AI landscape. Whether Musk ultimately succeeds in his takeover bid or Altman maintains control, one thing is certain—the race to dominate AI is far from over.