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Paramount Skydance is gearing up to sell one of the largest debt packages in corporate history as it moves to close its acquisition of Warner Bros. Discovery, a deal valued at roughly $110 billion in enterprise value. The combined entity is expected to carry somewhere between $79 billion and $87 billion in total debt after closing.
The financing puzzle
Bank of America and Citigroup are among the major banks that have committed between $54 billion and $57.5 billion in debt financing to get the deal across the finish line. Private equity capital is also part of the mix.
The post-merger leverage ratio is projected to land at approximately 6 to 6.5 times EBITDA. For every dollar the combined company earns before interest, taxes, depreciation, and amortization, it will owe about six dollars in debt.
Bondholders have already granted consent for amendments to existing debt terms in light of the merger, which removes one potential obstacle.
How we got here
The definitive merger agreement was signed on February 27, 2026, with Paramount Skydance offering $31 per share in an all-cash deal for WBD, plus a potential ticking fee for shareholders. WBD shareholders ratified the merger on April 23, 2026, clearing one of the major hurdles.
The bidding process was competitive. Netflix was among the companies that submitted offers. Paramount Skydance ultimately won with its all-cash bid.
The transaction is expected to close in the third quarter of 2026, though regulatory approvals in both the US and Europe are still pending.
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