Bidding war or upgrade! Warner Bros. market pricing (WBD.US) acquisition offer is expected to increase again.

Traders speculate that the control battle for Warner Bros. Discovery Channel (WBD.US) will prompt one of the bidders to raise their offer. The stock price of this long-standing Hollywood studio closed slightly below $29 per share on Wednesday. The day before, Paramount Sky (PSKY.US) indicated that they may increase their offer by at least $1 to $31 per share, causing the stock price to briefly surpass that level. Warner Bros. agreed in December of last year to sell at a price of $27.75 per share to Netflix (NFLX.US), along with some of its cable TV networks (such as TNT and CNN). Since the bidding war began, Warner Bros.' stock price has never exceeded $30 per share, possibly due to market concerns that Netflix's acquisition deal could undergo lengthy regulatory scrutiny, along with uncertainties in the valuation of cable TV assets. Meanwhile, Warner Bros.' board has repeatedly rejected Paramount Sky's acquisition offer of $30 per share. On Tuesday, Warner Bros. received a modified proposal with improved terms, prompting them to agree to restart negotiations with Paramount Sky. This news led to a turnaround in the acquisition process. Boosted by this news, Warner Bros.' stock price rose by 2.7%, up about 7% from its low point two weeks ago, leading to speculation in the market that the bidding is not yet over. Matt Osowiecki, portfolio manager at Water Island Capital LLC focusing on merger arbitrage, stated on Wednesday: "Based on today's trading price versus a few days ago, it appears people believe that the acquisition price for this asset will likely exceed $30. If $30 is the highest price you are willing to accept, then the trading price of this stock would not be $29. It has to be lower to compensate for the time value of your money." Michael Broudo, an event-driven analyst at Aon Hemmer, stated that according to the wording in Paramount Sky's press release, their previous offer of $31 per share was not a "final bid," so raising the offer to $32 per share seems like a "reasonable estimate." Paramount Sky has been attempting to acquire Warner Bros. since September last year, ultimately leading to Warner Bros. officially being put up for sale. The company has raised their offer multiple times, but ultimately lost to Netflix. Three days later, Paramount Sky initiated a hostile takeover of Warner Bros. at $30 per share, subsequently revising their offer twice in response to certain issues, but did not raise the price. Warner Bros. reached a waiver agreement with the streaming giant, allowing them to negotiate the terms of Paramount Sky's latest offer for 7 days until February 23rd.