Bankers are actively preparing to sell $49 billion in debt to support Paramount Skydance Corp.'s acquisition of Warner Bros. Discovery Inc., marking one of the year's most anticipated financing deals. A premarketing process is expected to begin in the next couple of weeks, aiming to capitalize on favorable credit market conditions, even amidst a volatile macroeconomic environment. This activity highlights the robust demand for credit financing.
The financing package, which was initially valued at $54 billion but later cut to $49 billion by dropping a separate $3.5 billion credit facility, is being arranged by major financial institutions including Bank of America Corp., Citigroup Inc., and Apollo Global Management Inc. The early indications from investor conversations suggest that the debt package will likely include approximately $30 billion in high-grade bonds, around $12 billion in junk bonds, and $7.5 billion in loans.
The wide distribution of the debt suggests strong institutional interest. Eighteen lenders have already committed to portions of the $49 billion debt, showcasing a broad participation in this significant M&A financing. This multi-faceted approach to financing, leveraging various debt instruments, is a strategic move to secure the necessary capital for the acquisition, which is being spearheaded by the billionaire Ellison family.
