$52 billion in bonds and loans funded Skydance’s $110 billion Warner Bros. Discovery deal

Skydance, the name the combined company now uses, completed its acquisition of Warner Bros. Discovery on October 6, 2026. The deal was valued at about $110 billion. Paramount raised about $52 billion in bonds and loans to fund it, and the company’s completion release says Bank of America, Citigroup and Apollo led the debt financing.

The debt sets the annual interest bill the combined company must pay, and its repayment plan depends on cost cuts and cash flow. Coverage comes from a company filing and a small group of financial outlets, and they do not agree on every figure.

A short-term loan and a bond and loan sale

Bank of America and Citigroup provided a $57.5 billion short-term loan, working with Apollo Global Management, one report says. Both banks later sold parts of that debt to other firms.

The longer-term funding came in a sale of bonds and loans. One report says Paramount began its debt sale on September 24 and sold $52 billion across markets in about a week. Another report says senior secured notes launched on September 28. The sources do not reconcile the two dates.

The sale also had a deadline. One report says a September 30 date would have triggered late fees of $7 million a day. Another says the daily fee applies if closing slips past October 7. A report dated October 4 said closing was expected within a day. Neither report says whether any fees were charged.

Net debt after the deal
Paramount said the merged business would carry $79 billion of net debt, according to Sherwood. The completion release targets net leverage of 3.0 times by the end of 2029.

What the bond and loan package contained

A report on the sale puts the senior secured notes at about $44.4 billion, launched on September 28. Within that total, it gives about $32 billion of investment-grade bonds and $12.4 billion of high-yield, or junk-rated, bonds. A $7.5 billion term loan makes up the rest of a package of roughly $52 billion.

A related headline on the same site cites a $41.4 billion figure for the debt pricing. The report does not explain the gap.

The high-yield portion’s 10-year dollar bonds were marketed in the low 9% range, the report says. It compares that with a 10-year Treasury yield of 5.17% on September 25.

The sources give a rate only for the high-yield 10-year bonds. Another report says the mix moved toward loans and away from bonds, but it gives no amounts for the shift.

How the ratings moved before closing

Fitch Ratings cut Paramount’s credit rating to BB+, which one report calls the highest junk rating, and placed the company on rating watch negative. Sherwood says the action came on Monday evening. Bloomberg Law’s report is timestamped March 3.

Fitch said it could downgrade again once it had more clarity on the final financing terms and on how quickly the combined company would pay down debt. Sherwood reports that the company’s shares fell about 7% on March 3.

S&P Global moved its outlook to negative the same week, Sherwood reports. It said the acquisition would push leverage well above its 4.25 times downgrade threshold for the current rating. The report does not say how S&P measured leverage.

On the same Monday, Paramount said the merged business would carry $79 billion of net debt, according to Sherwood. Bloomberg Law says Paramount was on track to be one of the biggest borrowers in the US high-yield bond market, though it gives no ranking.

The release also warns that the company may not be able to reduce debt as planned.

The targets for bringing debt down

The completion release says the company expects to bring net leverage down to a 3.0 times target by the end of 2029. It also expects free cash flow above $10 billion by 2030, which it says will reduce leverage.

The release points to at least $6 billion of run-rate synergies within three years. A separate report says Paramount plans to cut $6 billion a year in expenses to keep leverage under control. The sources describe the $6 billion differently, and the reports do not say whether they describe the same plan.

Interest is the other side of the calculation. One report estimates the deal adds $250 million to $500 million a year in interest costs. It also says a cut of 37.5 basis points in pricing saved about $200 million a year, according to the chief financial officer.

The sources also do not break the cost targets down by business line. The release ties debt paydown to free cash flow, and the report ties it to expense cuts. Neither says which parts of the combined company would be affected.

The release also warns that the company may not be able to reduce debt as planned.

Where the reported figures do not match

The completion release is dated October 6, 2026 and says the acquisition completed that day. 24/7 Wall St. reported Paramount’s estimated close of October 7. Sources give the value as $110 billion, while Sherwood’s quotation of S&P Global and a 24/7 Wall St. headline use $111 billion. They also disagree on several debt figures.

Webull gives the bridge loan as $57.5 billion and the bond and loan sale as $52 billion. The report that gives the $52 billion figure does not explain the $5.5 billion difference.

Sherwood reports the Fitch action on Monday evening, and Bloomberg Law’s report is timestamped March 3. Neither source prints March 2 as the date of the action.

None of the cited sources gives a current net leverage multiple for the combined company. 24/7 Wall St. cites an S&P Global estimate of about 7.6 times EBITDA through 2027. The March figures are a net debt amount and S&P’s threshold, and the 3.0 times target is set for the end of 2029.

Apart from the completion release, the dated financing reports predate the October 6 closing. The completion release is the only cited source dated at closing, so the post-closing debt terms are not covered here.

Photo: Coolcaesar · CC BY-SA 4.0 · via Wikimedia Commons