Yeah, they went from a more permissive license (Mozilla MPL) to a less permissive one (BUSL) but I can kind of understand why. I can also understand why the OSS community is upset, and after Hashicorp went after OpenTOFU recently, I'm siding more with the OSS community here.
Before the license change, another project (Pulumi) built something that was basically a thin wrapper on Terraform and some convenient functionality. They claim they tried to submit PRs upstream. Hashicorp loudly complained about organizations that were using their source without making contributions back when they changed to BUSL. I wasn't close enough to be aware of details there, but maybe there were other groups (I can think of Terragrunt, too, but I'm not sure they're included in the parties Hashicorp was complaining about. Terragrunt did side with OpenTOFU after the license change, though). This also means cloud providers can't stand up their own Terraform cloud service product as it could interfere with the BUSL license.
When the license was updated to BUSL, several contributors forked the last MPL-licensed version into OpenTF, then renamed to OpenTOFU. Some say that Hashicorp should have gone full closed-source to own their decision. I think they knew they were benefitting greatly from several large corporations' contributions for provider-specific configuration templates and types.
Then, earlier this month (two weeks ago?) Hashicorp brought a case against OpenTOFU claiming they have stolen code from the BUSL-licensed version, with OpenTOFU outright denying the claim. We'll see how that shakes out, but it shows that Hashicorp wasn't merely concerned about copyright & business/naming concerns (a big part of why other BUSL-licensed projects chose the license). I don't know if the upcoming M&A had anything to do with their license decision but I kind of doubt it? Maybe others here have more context or are more familiar with matters than I am.