Elon Musk’s bid to purchase the popular artificial intelligence (AI) startup for ($97.4) billion was completely rejected, according to the chairman of OpenAI’s board.

In a statement published by the firm on Musk-owned X, previously Twitter, board chairman Bret Taylor stated, “OpenAI is not available for sale, and the board has strongly dismissed Mr. Musk’s latest proposal to interfere with his competition.”

The statement went on to say, “Any possible reconfiguration of OpenAI will strengthen our not-for-profit and its goal to make sure AGI (artificial general intelligence) advances all of humanity.”

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Whereas Musk stated in court filings on Wednesday that if OpenAI’s board decides to put the artificial intelligence pioneer back on a non-profit “charity” model, he will cancel his offer to purchase the company.

Open AI Functioning Non-Profit

At the moment, OpenAI has a hybrid organizational structure, functioning as a non-profit with a profitable subsidiary. The shift to a for-profit business model, which Altman believes is essential to the company’s growth, has made the already existing conflicts with Musk harsher.

In 2015, Musk and Altman were part of an (11)-person team that created OpenAI, with Musk contributing ($45 million) in early investment.

Elon Musk left the business three years later, citing “a possible future tension for Elon… as Tesla continues to become concentrated on AI,” according to OpenAI.

After OpenAI sparked a global passion for artificial intelligence, Musk founded his own business, xAI, in early 2023.

OpenAI has been forced to look for a new organizational structure that would provide investors interest and provide more secure governance due to the huge costs associated with creating, training, and implementing AI models.

Advice For Profit

Authorities in California and Delaware must approve the conversion to a regular for-profit business. They will also examine the valuation of OpenAI’s non-profit division when it gets ownership in the new business. To get the most out of their position in the new business, existing investors desire a lower valuation.

According to The Information, Musk’s offer, which values the non-profit OpenAI at ($97.4 billion), is around ($30 billion) higher than what is being negotiated, and seems to be intended to damage the company’s efforts to raise funds.

Musk’s offer was made by a rival “who is having trouble to continue to keep up with technological advancement and compete with us in the marketplace,” according to Chris Lehane, Chief Global Affairs Officer of OpenAI.