Hollywood M&A variables again: Paramount Skydance (PSKY.US) revised the price to $31 per share, and Warner Bros. (WBD.US) reopened a seven-day negotiation window.

Warner Bros. Discovery Corporation (WBD.US) has agreed to temporarily restart negotiations with competitor Hollywood studio Paramount Skydance (PSKY.US), setting the stage for a potential second round of bidding war with Netflix (NFLX.US). According to a statement on Tuesday, Warner Bros. has reached an exemption agreement with the streaming giant, allowing them to engage in discussions regarding the terms of Paramount Skydance's most recent offer within seven days. This decision was made after a banker from Paramount informed Warner Bros.' board members that if the company agrees to resume negotiations, Paramount would offer at least $31 per share. This is $1 higher than Paramount's previous proposal per share. The company also stated that the current bid is not their "highest and best" offer. Warner Bros. stated that the board still unanimously recommends that shareholders vote in favor of the binding agreement to sell its eponymous studio and HBO Max streaming business to Netflix for $27.75 per share. The company has scheduled a shareholder vote on Netflix's deal on March 20. Warner Bros. CEO David Zaslav said in a statement, "Throughout this process, our singular focus has been maximizing value and certainty for Warner Bros. Discovery shareholders." The decision to re-engage with Paramount confirms earlier media reports. Prior to this, the hostile acquirer Paramount Skydance submitted a revised bid on February 10, addressing several key concerns of Warner Bros.' board. According to the waiver granted by Netflix, Warner Bros. can engage with Paramount until February 23. The statement mentioned that Warner Bros. has requested Paramount to provide their highest and final proposal and plans to discuss any unresolved defects in the latest offer during this period. If, after the negotiation period, Warner Bros.' board determines that Paramount has put forward a more favorable offer, Netflix will have the right to match Paramount's latest bid to keep their existing agreement intact. Paramount has been attempting to acquire Warner Bros. since September of last year, leading to Warner Bros.' formal listing for sale. Before ultimately losing out to Netflix, the company had raised their bid multiple times. Three days later, Paramount launched a hostile takeover bid of $30 per share for Warner Bros. Under the terms of the agreement with Netflix, Warner Bros.' cable television channels (such as CNN and TNT) will be spun off into a new company called Discovery Global. Paramount, which intends to acquire all of Warner Bros.' businesses, insists that their deal is more beneficial to shareholders and has been lobbying regulatory agencies and investors over the past few months. In their recent proposal, Paramount agreed to cover the $2.8 billion fee owed to Netflix if Warner Bros. terminates the agreement, and offered to guarantee the refinancing of Warner Bros.' debt. Paramount also stated that if the deal is not completed by December 31, they will compensate Warner Bros.' shareholders, highlighting their confidence in swiftly obtaining regulatory approval for the transaction.