If Zhou Tian could slay the Undead Overlord, then it was just as he said. If they joined forces, the power held by the Undead Overlord could be easily annexed by them.
When he learned that his old rival was doomed, a tinge of melancholy unavoidably arose in the Blood Moon Lord's heart. But more than that, he felt contentment.
A mutual understanding born out of long-term conflict wasn't out of the question, but it certainly wouldn't happen between the Blood Moon Lord and the Undead Overlord. At this point in their rivalry, both sides wished nothing more than for the other's demise, so why would they summon any emotions borne out of their prolonged conflict to spare each other now?
Thus, once Zhou Tian and his allies have settled the division of benefits, they could launch their action.