Warner Bros. chose Netflix over Paramount — again. Now what?

So, what just happened?

Early Wednesday morning, Warner Bros. Discovery, CNN’s parent company, published a letter to shareholders and an SEC filing, formally rejecting Paramount’s latest offer for the entire company, deeming the hostile takeover bid “illusory.”

The current deal to sell Warner’s studios and streaming assets to Netflix, the board said, is still better for WBD shareholders.

Why did WBD reject Paramount?

Mostly, it’s about money: The WBD board said Paramount’s deal “provides inadequate value and imposes numerous, significant risks and costs on WBD.”

But WBD also called Paramount’s offer too risky. Its board wrote that Paramount had “consistently misled” WBD’s shareholders by claiming its $30-per-share, all-cash offer was “backstopped” by Paramount CEO David Ellison and his father, Larry Ellison, the Oracle co-founder worth an estimated $240 billion.

Meanwhile, in the background, lawmakers have raised national security concerns over Paramount’s use of financing from Middle Eastern partners.

What is Paramount saying?

The Ellisons insist they are fully backstopping the bid — guaranteeing funding if partners back out. But WBD’s letter refutes the claim: “It does not, and never has.”

Paramount last week claimed to have “air-tight financing,” and deemed any suggestion otherwise to be “absurd.”

And in its regulatory disclosures, Paramount said that sovereign wealth funds controlled by Saudi Arabia, Qatar and the United Arab Emirates would hold no voting power over WBD if the transaction is completed. However, the royal families’ involvement has only sharpened scrutiny of the Paramount offer.