Paramount’s $110B Warner Bros. Deal Advances as Netflix Withdraws and Debt Hits Junk
Paramount Skydance’s $31-per-share takeover bid for Warner Bros. Discovery has won board approval after Netflix declined to increase its bid, clearing the path for a $110 billion merger. Fitch Ratings downgraded the combined company’s debt to BB+ on negative watch to reflect the projected $79 billion in net leverage.
1. Paramount’s $31-per-Share Offer Accepted
Warner Bros. Discovery’s board approved the $31-per-share acquisition proposal from Paramount Skydance after Netflix opted not to match the offer. This decision reinstates Paramount as the leading bidder and sets the stage for closing once regulatory conditions are met.
2. Merger Valuation and Debt Load
The transaction values the combined entity at $110 billion and will carry approximately $79 billion in net debt. Financing is structured through a mix of new debt issuance and equity contributions to fund closing costs and ongoing operations.
3. Fitch Downgrades Corporate Credit
Fitch Ratings lowered Paramount Skydance’s long-term issuer rating from BBB- to BB+ and placed it on negative watch. The downgrade reflects competitive pressures in media and concerns over the timeline for deleveraging given high leverage levels.
4. Regulatory Approval and Integration Outlook
The acquisition remains subject to antitrust clearance, with regulators likely scrutinizing market concentration and competitive impact. Post-close, integration will focus on consolidating content libraries, streamlining operations and preserving free cash flow.