Paramount Skydance opened a $7.5 billion loan sale Thursday to help pay for its $111 billion takeover of Warner Bros. Discovery and to retire some existing debt.
The senior secured term loan joins a financing stack that the company says will total about $44.4 billion in additional secured borrowing beyond previously announced deals. Oracle founder Larry Ellison, father of Paramount chief David Ellison, has personally guaranteed $46.7 billion in equity, and sovereign wealth funds from Saudi Arabia, Qatar and the United Arab Emirates have committed $24 billion.
The fundraising arrives as the deal nears the finish line. Paramount settled an antitrust lawsuit with 12 state attorneys general, and a judge scheduled a Thursday hearing on the proposed consent decree. With approval, the merger could close in roughly two weeks. The settlement forces no immediate divestitures and imposes minimal commitments, including at least 30 film releases a year. Regulators in nearly 70 jurisdictions have cleared the transaction, and the Federal Communications Commission has approved the financing. The FCC decision allows foreign investors to hold 49.5% of the combined company, with room to go higher. Paramount says those stakes will carry no votes.
Borrowing costs have climbed since the banks first underwrote the debt. Bloomberg reported that the financing carries uncapped interest rates, letting lenders demand more if credit markets sour. Since the underwriting, the Federal Reserve and European Central Bank have both raised rates, and corporate credit spreads have widened.
Morgan Stanley analysts estimated the merged company would carry $77.2 billion in net debt at the end of 2026, a figure likely to rise with the new loans. Counting Warner’s own borrowings, total obligations could reach $87 billion, and unions at both companies predict significant layoffs. California Attorney General Rob Bonta has tried to reassure entertainment workers that job cuts will not follow.
The same analysts see upside. Diffley and Duran described a combined HBO Max and Paramount+ as a “streaming powerhouse” that could rival Disney and Amazon for the second and third spots behind Netflix. Morgan Stanley expects the merger to produce more than $6 billion in savings, roughly 11% of operating costs, and believes the company can reduce its leverage over three years.
