Delaware AG Seeking Bank to Advise on OpenAI Restructuring
(Bloomberg) -- Delaware's attorney general is planning to hire an investment bank that would advise her office as it examines OpenAI's restructuring plans aimed at drawing more investors, according to a person familiar with the matter.
The bank would help Delaware Attorney General Kathy Jennings complete an independent valuation of OpenAI's assets to fulfill her responsibilities to review the restructuring plan, according to the Wall Street Journal, which reported earlier on the matter.
OpenAI has been in talks over its restructuring plans with officials in Delaware and California who have the power to sue the company if they determine the overhaul is not in line with the public interest. The regulators want assurances the revamped startup will continue prioritizing its founding mission — building generative artificial intelligence to benefit humanity.
OpenAI didn't immediately respond to a request for comment. The California attorney general's office declined to comment on its ongoing investigation.
In May, the startup dropped plans to become a more conventional for-profit company in the wake of pressure from ex-employees, academics and competitors, including billionaire Elon Musk. The ChatGPT maker, which is valued at $300 billion, said it would restructure its for-profit division as a public benefit corporation, but keep the overall business under the control of its nonprofit — a shift that could help it raise funds and reap profits.
Whether OpenAI will remain dedicated to its charitable mission is also at the heart of a lawsuit brought by Musk challenging OpenAI's transformation. Musk has alleged the alliance OpenAI forged with Microsoft after he left the startup's board in 2018 is a bid to dominate the generative AI industry that threatens free market competition by rivals, including his own AI startup xAI.
A federal judge in Oakland, California, has set a trial for March over Musk's claims.
--With assistance from Shirin Ghaffary.
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