Warner Bros. Discovery’s board of directors has made it clear to its shareholders that they should reject Paramount Skydance’s hostile bid to take over the company for US$30 a share. 

Clarifying the board’s position, chairman Samuel Di Piazza Jr. said Paramount’s new US$108-billion offer still fails to address many of WBD’s key concerns and presents numerous risks and costs to its shareholders. These major sticking points include questions over whether Paramount CEO David Ellison’s revocable family trust can be relied on to backstop the deal and uneasy feelings about foreign financing entering the picture.

It shouldn’t come as a major surprise that the board wants this offer rejected, since it’s essentially the same bid that Paramount Skydance submitted at the start of the month. The details that changed in this latest round were how the merged company planned to raise the capital, which would include Ellison guaranteeing the deal through a trust, removing a US$1-billion contribution from China’s Tencent and breaking down how US$24 billion in Middle East sovereign funds was divided among Saudi Arabia, Abu Dhabi and Qatar. 

For now, WBD is intent on going full steam ahead with Netflix as its chosen suitor—but for that to happen, its shareholders need to heed the board’s advice. And even if they do, Paramount still has cards left to play. No doubt Ellison and his teams are evaluating whether to make a higher offer—one that could set off a potential bidding war. Ellison even hinted at the beginning of the month that US$108 billion was not Paramount’s “best or final” offer in a message to David Zaslav. 

Netflix is sitting pretty for now, with co-CEO Greg Peters telling CNBC earlier this week that WBD’s board has made it clear that the streamer’s US$83-billion offer for the studio’s film and TV assets brings the most value and presents the fewest regulatory challenges. And co-CEO Ted Sarandos clarified that future Warner Bros. films would continue to roll out in theaters with a traditional window after the acquisition, adding that he now sees value in adding a theatrical distribution arm to his arsenal. 

But if Paramount rolls up with yet another sweetened offer, WBD’s board may feel the pressure from shareholders to turn back to Netflix to see just how deep the streamer’s war chest goes.