Banks Initiate Debt Sale for Paramount Skydance’s Warner Bros. Discovery Acquisition

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Banks Initiate Debt Sale for Paramount Skydance's Warner Bros. Discovery Acquisition

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Banks, including Citigroup Inc., Bank of America Corp., and Apollo Global Management Inc., are initiating investor calls to sell approximately $49 billion in debt to support Paramount Skydance Corporation’s acquisition of Warner Bros. Discovery Inc.. This financing is a crucial step for the $110 billion merger, which was announced on February 27, 2026. The debt package was underwritten earlier in 2026 and includes about $30 billion in investment-grade bonds, $7.5 billion in investment-grade loans, and roughly $12 billion in second-lien bonds.

The acquisition faced delays due to a series of lawsuits, which have now been settled. As part of the settlements, Paramount Skydance agreed to invest an additional $1.5 billion in U.S. film productions over five years. Regulators in nearly 70 jurisdictions, including the Federal Communications Commission, have approved the merger.

The financing for the deal carries uncapped interest rates, meaning lenders can adjust costs if credit market conditions worsen. Since the deal was underwritten, both the Federal Reserve and the European Central Bank have raised rates, and corporate credit spreads have widened. This structure is intended to protect banks from potential losses on unsellable debt due to rising interest rates, a situation that occurred in 2022.

Paramount Skydance Corporation was formed in August 2025 through an $8 billion merger between Skydance Media and Paramount Global. David Ellison, founder of Skydance, serves as CEO and chairman of the combined company. The acquisition of Warner Bros. Discovery is expected to be completed by approximately October 5, 2026.

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