Warner Bros Discovery (WBD) is reportedly weighing reopening sales talks with Paramount Skydance, in a move that could spark a fresh bidding war with Netflix for the Hollywood film and TV company.

Members of the board of WBD are discussing whether to re-engage with Paramount, which is pursuing a hostile $108.4bn (£76.8bn) cash takeover directly with shareholders in a bid to derail an agreed deal with Netflix, according to Bloomberg.

Paramount said last week that it would cover a $2.8bn fee owed to Netflix if WBD pulled out of its agreement and is offering to backstop a multibillion-dollar refinancing to eliminate $1.5bn in costs. It has also added a “ticking fee” amounting to about $650m in cash each quarter if the deal is not closed by the end of the year.

Paramount moved last week to bolster its political lobbying power by appointing Rene Augustine, a former attorney in the Trump administration, as its senior vice-president of global public policy.

David Ellison, the chair and chief executive of Paramount, said its dogged pursuit of WBD showed its “strong and unwavering commitment to delivering the full value WBD shareholders deserve”.

WBD responded by saying that it was reviewing the amended offer from Paramount and is facing pressure from some smaller shareholders, including Pentwater Capital Management and Ancora Holdings Group, to engage with the rival bidder.

However, so far shareholders representing less than 2% of WBD’s stock have been committed to Paramount’s hostile bid, and the company has already twice extended its deadline, which now stands at 20 February.

If WBD decides to formally open talks with Paramount it would need to notify Netflix first, and such a move is likely to kick off a further sweetening of offers.

In January, Netflix sweetened its offer for the studios and streaming businesses of WBD by making it an all-cash deal.

Under the Netflix deal, the streaming company is seeking to take control of prized assets such as Warner Bros, the studio behind franchises including Harry Potter, Superman and Batman, as well as HBO, home to shows including Game of Thrones, The White Lotus and Succession.

However, it is not seeking to acquire its global networks operation, including CNN, the Cartoon Network and Discovery Channel, which is proposed to be spun off with WBD investors taking a stake.

Paramount is seeking to take over the entirety of the media conglomerate.

Members of the Warner Bros board are discussing whether Paramount is the better deal but have not decided how to respond, Bloomberg reported.

WBD had said it was planning a special shareholders’ meeting at some point in April to vote on the Netflix merger.