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Warner Bros. Discovery (WBD) has indicated it is open to negotiating with Paramount Skydance if David and Larry Ellison increase their $30-per-share all-cash "hostile" offer.

The move comes as Netflix's $82.7 billion cash-stock bid for the media giant remains the board's preferred option, sources told The Post.

The Ellisons, along with RedBird Capital, are weighing their next steps, including a strategy dubbed "DefCon 1," which could involve walking away from the bidding process or even pursuing litigation over how WBD handled the process.

Paramount Skydance insists its $78 billion all-cash proposal is superior to Netflix's offer and has no immediate plans to raise the price, even as the WBD board pressures them to do so.

People close to Paramount Skydance argue that WBD favored Netflix's offer due to a personal connection between CEO David Zaslav and Netflix chief Ted Sarandos.

Paramount emphasizes that its bid would acquire all of WBD, including cable channels like CNN and Discovery, with no significant regulatory overlap, unlike Netflix's plan to buy only the studio and HBO Max, which may trigger antitrust scrutiny.

To address financing concerns, Larry Ellison has personally guaranteed the $40.4 billion equity portion of the Paramount offer.

This includes making his family trust irrevocable for the deal, which WBD had previously questioned.

Warner Bros. Discovery Demands Higher Offer

Paramount also raised its breakup fee to $5.8 billion, matching Netflix's commitment to shareholders if its deal falls apart.

"Larry personally guaranteeing the deal is a great start but what [WBD is] saying is if you guys want the company, pay more," said a person with direct knowledge of WBD's thinking.

The Ellisons and RedBird have discussed increasing their offer by up to 10% to satisfy the board.

The stakes are high. Netflix's stock accounts for 16% of its offer, creating volatility as investors weigh WBD's costs and liabilities.

WBD is also factoring in potential proceeds of $3 to $4 per share from the planned spin-off of cable properties, which would leave the new company with $15–18 billion in debt.

Investor reactions are mixed. Mario Gabelli, a WBD shareholder, expressed support for the Ellisons' proposal and may tender his shares, though only 400,000 of the 2.6 billion WBD shares have been pledged so far.

According to CNN, shares of WBD rose 4% Monday, Paramount's stock jumped 3%, while Netflix remained flat.