Business 5 min read By Lauren Baxter
Paramount to Raise $7.5 Billion in Debt for Warner Bros. Discovery Merger
Paramount Skydance has launched a syndication to raise $7.5 billion through senior secured term B loans, part of the financing for its $111 billion acquisition of Warner Bros. Discovery. The move follows a legal settlement that cleared a path for the merger to close.
Paramount Skydance has begun raising $7.5 billion in new debt to help fund its $111 billion acquisition of Warner Bros. Discovery, the company said Thursday. The David Ellison-led firm launched a syndication for a proposed senior secured incremental tranche of term B loans, with proceeds earmarked for the merger and for paying down certain other debt.
The debt raise is part of a broader financing package. Paramount now intends to raise approximately $44.4 billion in total, according to people familiar with the plans. The company moved forward with the syndication after a legal settlement earlier this week removed a key obstacle to the deal.
On Monday, Paramount and Warner Bros. Discovery settled two antitrust lawsuits that had threatened to delay or derail the merger. The agreement, negotiated with state attorneys general, paved the way for the transaction to proceed. A federal judge had been expected to sign off on the settlement Thursday, but delayed the hearing, leaving the final approval pending.
The California Attorney General’s office has insisted the deal was «not the result of collusion,» pushing back against criticism of the settlement process. Despite the 11th-hour legal hiccup, the merger appears on track to close within the next two weeks.
Mergers-and-acquisitions specialists weighed in on the deal Thursday, with some describing the outcome as a sign that «tech has won.» The comment reflects a view that Paramount, now backed by tech fortune and led by Ellison, has outmaneuvered traditional Hollywood players in the race for Warner Bros. Discovery’s valuable library and franchises.
The $111 billion price tag makes the transaction one of the largest media mergers in recent memory. It would combine Paramount’s film and television studios, including CBS and Paramount Pictures, with Warner Bros. Discovery’s portfolio, which includes HBO, CNN, and the Warner Bros. film studio.
Paramount’s decision to tap debt markets for the additional $7.5 billion underscores the scale of financing required to complete the acquisition. The senior secured term B loans are being syndicated to institutional investors, a common route for large corporate borrowings.
The company has not disclosed the interest rate or maturity of the new tranche. Proceeds will also be used to pay down certain existing debt, Paramount said, without specifying which obligations would be retired.
Warner Bros. Discovery shareholders approved the merger earlier this year, but the deal has faced regulatory and legal scrutiny. The settlement of the antitrust suits removes one of the last major hurdles, though the judge’s delayed sign-off means the timeline could still shift.
If completed, the merger would create a media giant with significant leverage in content production, streaming, and cable news. It would also mark a major consolidation milestone for an industry grappling with the rise of streaming and changing consumer habits.
Paramount Skydance is the entity formed after the merger of Paramount Global and Skydance Media, led by David Ellison, son of Oracle co-founder Larry Ellison. The company has signaled ambitions to compete more aggressively in the streaming wars and to invest in technology-driven entertainment.
The debt syndication is being arranged by a group of banks, though the company did not name the institutions involved. Such syndications typically involve a roadshow to gauge investor demand before the loans are priced and allocated.
For now, the focus remains on the court’s next steps. The judge’s delayed hearing means the settlement approval could come later than expected, but neither Paramount nor Warner Bros. Discovery has indicated the deal is at risk.
The merger’s closing would cap a turbulent period for both companies, which have faced shareholder pressure, leadership changes, and the challenges of a shifting entertainment landscape. The combined company would be better positioned to negotiate with advertisers, distributors, and talent, though it would also face intense scrutiny over its market power.
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