- Paramount secured up to $54 billion in financing for its Warner Bros. bid from top Wall Street firms
- The $30 per share Paramount offer exceeds Netflix's $27.75 bid and covers all of Warner Bros.
- Netflix arranged $59 billion in unsecured bridge loans for its $72 billion Warner Bros. acquisition
Paramount Skydance Corp. has lined up as much as $54 billion of financing from Wall Street's biggest firms to help support its planned acquisition of Warner Bros. Discovery Inc., just days after the company agreed to a deal with Netflix Inc.
Bank of America Corp., Citigroup Inc. and Apollo Global Management Inc. are providing the debt commitment — which is one of the largest of its kind — according to a statement Monday. The bridge loan, a type of facility that's usually replaced with permanent financing such as bonds, will be secured by Paramount assets.
Paramount's bid at $30 a share in cash comes after Netflix agreed to buy Warner Bros. for $27.75 in cash and stock in a $72 billion deal late last week. Paramount's bid is for the entirety of Warner Bros., while Netflix is only interested in the Hollywood studios and streaming business. Paramount said its offer gives shareholders $18 billion more in cash than the Netflix bid would.
For its deal, Netflix has lined up $59 billion of unsecured financing from Wells Fargo & Co., BNP Paribas SA and HSBC Plc in another bridge loan. While sizable, the financings don't quite match the $75 billion of loans Anheuser-Busch InBev SA obtained to back its acquisition of SABMiller Plc in 2015, which amounted to the largest ever bridge financing, according to data compiled by Bloomberg.
Even so, Wall Street is looking to earn lucrative fees tied to a long-awaited revival in acquisitions. Bridge loans are a crucial step for banks in building relationships with companies to win higher-paying mandates down the road. One or a small group of banks typically provide the initial bridge loan, and then bring in other banks to spread the risk once the acquisition is publicly announced. After a time, those loans are replaced with bonds sold to institutional investors.
Netflix, which is rated investment grade, is expected to replace its bridge loan with up to $25 billion of bonds, plus $20 billion of delayed-draw term loans and a $5 billion revolving credit facility, both of which are typically held by banks. Paramount has lower credit scores of a BB+ rating by S&P Global Ratings, which is one level below investment grade, and BBB- by Fitch Ratings, or on the cusp of junk.
Comprehensive Budget 2026 coverage, LIVE TV analysis, Stock Market and Industry reactions, Income Tax changes and Latest News on NDTV Profit.