Elon Musk plotted to derail a $500 billion artificial intelligence deal because his Silicon Valley nemesis, Sam Altman, was about to cash in.
OpenAI CEO Altman—Musk’s main rival for the title of artificial intelligence doyen—was part of an American delegation that jetted to the United Arab Emirates (U.A.E.) to finalize an agreement to build sprawling data centers in Abu Dhabi, the Wall Street Journal reported. The project, dubbed “Stargate UAE,” was spearheaded by OpenAI and Emirati company G24. It also included Silicon Valley companies Oracle, Nvidia, Cisco, and SoftBank.
Altman—who co-founded OpenAI with Musk in 2015—announced last week that his company and G42 had entered into a partnership. Musk, however, reportedly told officials from the Middle Eastern company on a call that President Donald Trump would not green-light the deal unless his own firm, xAI, were included in the agreement, the Journal reported.
G24 is controlled by Sheikh Tahnoon, the brother of the U.A.E.’s president, Mohamed bin Zayed Al Nahyan. He is the brains behind the country’s tech vision and was on the call with Musk.
Sources told the Journal that Musk caught wind of the deal days before it was inked and grew irate that he and xAI had been sidelined. He then insisted on joining the trip, sources claimed.
The publication reported that the 54-year-old “worked hard” to block the deal. A senior White House official reportedly said the billionaire “relayed his concerns about fairness for all AI companies.”
Trump took another look at the deal after his former “first buddy’s” pleas but gave it the go-ahead anyway, officials told the Journal.
Musk aides reportedly went into crisis mode and discussed how to calm him down, as Trump and his tech advisers wanted to make the agreement public before the end of the trip in mid-May.
A tentative deal for the data centers in Abu Dhabi was struck in March after Tahnoon visited the White House.
In return for providing a site and footing the cost of construction, the United States agreed to provide artificial intel chips and expertise to the petrostate, which has designs on becoming a tech hub.
The U.A.E. is expected to fund a similarly sized project in the U.S. as well, sources told the Journal.
Once upon a time, Altman and Musk were on the same side—dreaming up an altruistic AI utopia at OpenAI. However, Musk aborted the mission in 2018 and left the company, citing concerns about its direction.
Musk founded xAI in 2023 and has since accused “Scam Altman” of selling out to big tech. The Tesla CEO even filed a lawsuit in 2024 claiming the company abandoned its founding principles. Musk unexpectedly dropped the case in June last year.
He then filed a souped-up version of the lawsuit in August, naming Microsoft as a second defendant. In the suit, he claimed that the defendants had violated federal antitrust and securities laws.
In April 2025, OpenAI announced that it would countersue Musk. The Daily Beast has reached out to representatives of Musk, Altman, and xAI for comment.
