(Bloomberg) — Paramount Skydance Corp. stretched, then stretched, then stretched again in its audacious $110 billion takeover bid for Warner Bros. Discovery Inc.
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Now the companies’ bankers — and even the billionaire Ellison family itself — are doing the same as they prepare to bring the massive $50 billion debt sale for the buyout to market.
On the Warner Bros. side, a JPMorgan Chase & Co.-led bank group seized on red-hot demand for leveraged loans to save hundreds of millions of dollars in interest costs by refinancing a $15 billion bridge loan with longer-term debt. The lenders boosted the transaction’s size twice in a week, making it the largest so-called term loan B ever to hit the market, according to data compiled by Bloomberg.
Warner Bros.’ credit grade, on the higher end for junk-rated borrowers, coupled with scarce supply of new leveraged loans, helped garner more than $30 billion of orders from investors, according to people with knowledge of the transaction.
Paramount, meantime, has been working to convince credit-rating firms that it’ll keep its debt load contained enough to merit investment grade ratings on some of its obligations — a crucial step to cap financing costs that could otherwise overwhelm the combined entity. Chief Executive Officer David Ellison pledged that his family would do what it takes to keep Paramount’s leverage in line with forecasts.
Link: https://ca.finance.yahoo.com/news/paramount-pulling-every-lever-sell-190000973.html