Warner Bros. weighs reopening sale negotiations with Paramount

Warner Bros Discovery Inc. is considering reopening sale talks with rival Hollywood studio Paramount Skydance Corp. after receiving its hostile suitor’s most recent amended offer, people with knowledge of the matter said.

Members of the Warner Bros. board are discussing whether Paramount could offer a path to a superior deal, people familiar with the board’s thinking said, a move that may ignite a second bidding war with Netflix Inc. The board hasn’t decided how to respond and still has a binding agreement with Netflix, said the people, who asked not to be identified discussing nonpublic information. 

Paramount submitted amended terms last week that addressed several concerns. The company will cover a $2.8 billion fee owed to Netflix if Warner Bros. terminates their agreement, and is offering to backstop a Warner Bros. debt refinancing. Paramount also said it will compensate Warner Bros. shareholders if the deal doesn’t close by Dec. 31, underscoring its confidence that the deal will get swift regulatory approval. 

Warner Bros. still has some concerns about Paramount’s offer, many of which it has outlined in past statements, but this is the first time the board has considered Paramount’s offer could lead to a better deal or prompt Netflix to up its bid. It has also faced pressure from shareholders to...