10:40 AM EST, 02/11/2025 (MT Newswires) -- The $97.4 billion bid of an investor group led by Elon Musk to buy the nonprofit that controls Microsoft ( MSFT )-backed (MSFT) OpenAI is "not competitive," Wedbush Securities said in a note to clients Tuesday.

The firm said the offer's intent was to slow down the capital raising process of OpenAI, whose "board now has to look at this bid even though the valuation is likely closer to $300 billion."

Wedbush described OpenAI co-founder Sam Altman, who rejected the bid, as the "golden boy of the AI Revolution," but also took note of Musk's "massive power in the Beltway."

"The AI Arms Race is heating up in Big Tech and OpenAI has a very strong market position which poses a risk to other tech players including Musk," Wedbush analysts, including Daniel Ives, said. "We would expect the OpenAI board to formally reject this bid and continue its capital-raising process although the Musk-led bid is a fly in the ointment for Altman and OpenAI."

Price: 411.82, Change: -0.40, Percent Change: -0.10