The Warner-Netflix-Paramount Triangle Isn't Over Yet

Warner Bros. Discovery is putting Netflix on pause, at least briefly, to hear out a last-ditch pitch from the streamer's rival. On Tuesday, Warner said it has reopened talks with Paramount after the bidder signaled it would lift its all-cash hostile offer to at least $31 a share, up from $30, for the entire company, including CNN and TNT, per the Wall Street Journal. That's above Netflix's existing $72 billion deal for Warner's studios and HBO Max, and Paramount has also said it would cover the $2.8 billion breakup fee owed to Netflix if that agreement is scrapped.

Warner notes that the new negotiations will allow it to address "deficiencies" in Paramount's previous bids, reports the AP. Netflix, which has the right to match any competing bid, granted Warner a seven-day waiver to negotiate with Paramount, while insisting its offer is still superior, per Variety. Warner's board continues to back the Netflix deal, with a shareholder vote set for March 20, and insiders remain skeptical that Paramount can top it in a way that's both financially and legally solid, given the debt load and stricter covenants in Paramount's proposal.

Netflix, for its part, calls the development "another important milestone for our transaction with WBD," per a statement cited by CNBC. "We granted WBD a narrow seven-day waiver of certain obligations under our merger agreement to allow them to engage with PSKY to fully and finally resolve this matter," the company added. The Justice Department is reviewing both scenarios as the monthslong battle for the home of HBO, as well as the Superman and Harry Potter brands, heads into its next phase, per Variety.