Paramount has officially raised its offer for Warner Bros. Discovery $WBD to $31 per share, and WBD is extending the window for negotiations as a result. I find the “sweetener” outside the price particularly interesting: Paramount is also adding a $7 billion regulatory breakup fee, which in practice is a message to shareholders — “we’re not afraid of antitrust risks, and if it comes down to regulation, we’ll pay.” At the same time, WBD is clearly leaving the alternative path hanging — the deal with Netflix $NFLX is still in place, and the market is understandably speculating that Netflix might be willing to match or top the offer to avoid losing the library and studio that would give it a huge streaming advantage.

If you were a WBD shareholder, would you take $31 and the $7 billion “insurance” as sufficient reason to side with Paramount, or would you bet that Netflix will come up with an even higher bid — even at the cost of prolonging the whole process and risking the market punishing the uncertainty?