Paramount plans $49 billion debt sale for Warner Bros. merger

Paramount plans $49 billion debt sale for Warner Bros. merger

Wed, September 23, 2026 at 2:39 PM GMT+3 2 min read

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Paramount Skydance Corporation is preparing to launch a $49 billion debt sale to fund its $110 billion acquisition of Warner Bros. Discovery, after settling a series of lawsuits that had blocked the deal from closing, according to Bloomberg.

Bank of America, Citigroup, and Apollo Global Management — the banks that underwrote the debt package earlier this year — are now contacting potential investors, with a formal launch expected within weeks, Bloomberg reported, citing people who asked not to be named. The expectation is that the debt will sell down quickly once the sale begins, those people said.

The financing is divided into about $30 billion of investment-grade bonds, $7.5 billion of investment-grade loans, and around $12 billion of second-lien bonds, drawing from a dollar and euro investor base that is wider than what leveraged buyouts typically attract. Regulators in nearly 70 jurisdictions have approved the merger, and the Federal Communications Commission has signed off on the financing, according to Bloomberg.

Paramount's financing carries uncapped interest rates, which gives lenders the ability to charge the company more if conditions in credit markets worsen — and since the deal was underwritten, they already have. Both the Federal Reserve and the European Central Bank have raised rates, and corporate credit spreads have widened, according to Bloomberg. The arrangement is meant to spare banks from a recurrence of the 2022 episode in which surging interest rates trapped lenders with unsellable underwritten debt sitting on their books at steep losses.

The debt will be marketed using financial figures from earlier in the year, and bankers must bring it to market before those numbers become stale. Bankers are also considering launching the sale before the merger formally closes. Should that prove unworkable, the banks would fund the debt themselves, collecting interest payments from Paramount in the interim until a broader sale can be completed.

Paramount settled Monday with 12 state attorneys general and the Writers Guild of America, resolving an antitrust lawsuit led by California Attorney General Rob Bonta that had threatened to push the deal's resolution to mid-2027. The settlement requires Paramount to release a minimum of 30 films in cinemas annually in the first two years, rising to 32 per year over the three years after that, and to spend at least $1.5 billion above its 2025 domestic film production levels over five years.

The financial pressure to close is significant. Under the merger agreement, Paramount must pay Warner Bros. Discovery shareholders roughly $7 million per day beginning October 1 for every day the transaction remains unclosed. Paramount had targeted a closing date in the third quarter.

Once completed, the combined company will control two major Hollywood studios, two subscription streaming services, and dozens of television channels ranging from CBS to HBO.