Archive · 13 Dec 2025
Paramount's $54B Debt in Warner Bid
Paramount wants to buy Warner Bros.
Discovery, but it has to deal with a huge $54 billion debt.
This debt could become more expensive if market conditions change.
Paramount is trying to convince lenders that it will be a reliable borrower by promising to cut costs.
However, there are risks because the debt might not be sold easily, and the interest rates could go up.
Netflix is also trying to buy Warner Bros.
Discovery with a $59 billion loan, and it has a better credit rating than Paramount.
Both companies are competing to see who can offer the best deal.
Paramount Skydance Corp. is planning a $54 billion debt package to acquire Warner Bros. Discovery Inc.
Paramount aims to become an investment-grade borrower to secure cheaper interest rates and underwriting fees.
The debt package includes a bridge loan from Bank of America, Citigroup, and Apollo Global Management.
Netflix Inc. is competing with a $59 billion loan offer, which is unsecured and backed by a stronger credit rating.
Paramount's debt-to-earnings ratio is targeted at 4 times initially, with a goal to reduce it to 2 times within two years.
- Who
- Paramount Skydance Corp. and Netflix Inc. are competing to acquire Warner Bros. Discovery Inc.
- What
- Paramount is facing challenges with $54 billion in debt for the acquisition.
- When
- The takeover battle could extend into 2026.
- Where
- The financial activities are centered around global credit markets.
- Why
- Paramount aims to become an investment-grade borrower to secure cheaper interest rates and underwriting fees.
- Debt Amount
- $54 billion
- Paramount's Target
- Warner Bros. Discovery Inc.
- Competing Bidder
- Netflix Inc.
- Bridge Loan Providers
- Bank of America, Citigroup, Apollo Global Management
- Netflix's Loan Amount
- $59 billion
- Paramount's Debt-to-Earnings Ratio
- 4 times (targeting 2 times within 2 years)
- Moody's Expected Debt Leverage
- 7 times earnings
- Banking Fees for Lenders
- About 2.5% for typical LBOs, 70 basis points for investment-grade deal