"OpenAI said on Tuesday it had converted its main business into a for-profit corporation, the conclusion of a lengthy and fraught legal saga. A crucial regulator, Kathy Jennings, the Delaware attorney general, said she approved the plan for the startup, which began as a non-profit in 2015, to change to a public benefit corporation, a type of for-profit entity that expresses commitment to bettering society."
"The company also said it had reorganized its ownership structure and signed a new agreement with its longtime backer Microsoft that gives the software giant a roughly 27% stake in OpenAI's new for-profit corporation, but changes some of the details of their close partnership. OpenAI was valued at $500bn under the terms of the deal, making Microsoft's stake worth more than $100bn."
"The restructuring paves the way for the ChatGPT maker to more easily raise capital and profit off its artificial intelligence technology, even as it remains technically under the control of its own original non-profit entity. Jennings said in a statement she did not object to the proposal, seemingly bringing to an end more than a year of negotiations and announcements about the future of OpenAI's governance and the power that for-profit investors and its non-profit board will have over the organization's technology."
OpenAI converted its main business into a for-profit public benefit corporation and reorganized its ownership structure. Delaware attorney general Kathy Jennings approved the conversion, ending lengthy legal negotiations. OpenAI signed a new agreement with Microsoft giving the company roughly a 27% stake, valuing OpenAI at $500 billion and making Microsoft's stake worth more than $100 billion. The restructuring aims to facilitate capital raising and monetization of AI technology while the original nonprofit retains technical control over governance. Attorneys general in Delaware and California had investigated the proposed changes during nearly a year of engagement. Elon Musk challenged the conversion with a lawsuit and mounted a large takeover bid.
Read at www.theguardian.com
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