Paramount to finance Warner Bros. Discovery acquisition with $50 billion in debt
The mega-merger creates a media colossus valued at over $110 billion, but the mountain of leverage is raising eyebrows across Wall Street.
Paramount Skydance is betting that the best way to survive the streaming wars is to buy the competition. And it’s putting roughly $50 billion in debt on the table to do it.
The company’s acquisition of Warner Bros. Discovery, structured as an all-cash offer at $31 per share, values WBD at approximately $81 billion in equity. The total enterprise value of the combined entity lands somewhere between $110 billion and $111 billion, making this one of the largest media transactions in history.
The deal structure and who’s writing the checks
The debt commitments for this transaction range between $50 billion and $54 billion, with $39 billion classified as incremental new debt. Citigroup, Bank of America, and Apollo are among the primary financiers backing the acquisition.
Paramount also built in a mechanism to keep the deal on track. If the transaction doesn’t close by September 30, 2026, a ticking fee of $0.25 per share kicks in.
WBD shareholders already gave their blessing. The shareholder vote approving the acquisition took place on April 23, 2026, and the expected closing is targeted for the third quarter of 2026, pending regulatory clearances.
How we got here: Netflix tried first
Warner Bros. Discovery went through a rigorous bidding process before arriving at Paramount’s doorstep. Netflix reportedly made a prior merger proposal that WBD’s board ultimately rejected, choosing instead to go with Paramount Skydance’s offer.
What this means for investors and the media landscape
The $50 billion-plus in debt financing means the new company will be carrying an enormous leverage ratio from day one. Servicing that kind of borrowing requires substantial and consistent free cash flow, something the media industry has struggled to deliver in recent years as traditional revenue streams erode.
Regulatory scrutiny remains the final wildcard. A deal this size, combining two of the largest content libraries in entertainment, will inevitably draw attention from antitrust authorities. The Q3 2026 target closing date gives regulators several months to review, but the ticking fee structure suggests Paramount’s team isn’t entirely confident the timeline will hold.