OpenAI Considers Special Voting Rights to Block Hostile Takeovers

OpenAI is considering implementing special voting rights for its nonprofit board to safeguard against hostile takeovers, according to Reuters. This move comes as the company, known for its AI model ChatGPT, faces an unsolicited takeover bid from Elon Musk.

The potential governance changes are being evaluated by CEO Sam Altman and board members as OpenAI transitions to a traditional for-profit structure. The special voting rights would empower the nonprofit board to overrule major investors, including significant backers like Microsoft and SoftBank, thereby maintaining control over the company's direction.

Recently, OpenAI rejected a $97.4 billion acquisition offer from a consortium led by Musk. The offer was dismissed as disingenuous, with OpenAI reaffirming its commitment to its mission and rejecting any future bids. Musk's proposal was seen as an attempt to prevent OpenAI from becoming a profit-driven entity as it seeks additional funding to remain competitive in the AI industry.