Skydance Restructures WBD Debt After Completing Acquisition

Seeking Alpha··US·Read original
3▲0 ▼1Impact / 5
Summary · why it matters

Skydance said nearly all bondholders participated in its debt tender and exchange offers following the company's completion of its acquisition of Warner Bros. Discovery. About 98.83% of the aggregate principal amount of notes covered by the cash tender offers was validly tendered, while 99.15% of the notes included in the exchange offers were tendered. Under the exchange offers, eligible holders received newly issued Skydance notes in exchange for their existing WBD notes, and notes accepted in the tender and exchange offers will be retired and cancelled. Some exchanged WBD notes carry significantly higher coupons under Skydance: WBD's 4.125% notes due 2029 were exchanged for 6.25% Skydance notes, while its 4.054% notes due 2029 were exchanged for 6.304% Skydance notes. The offers were made in connection with Skydance's acquisition of WBD, which closed on October 6, with settlement expected on October 9. Separately, Fitch downgraded Paramount's credit ratings as the Warner Bros. Discovery acquisition closed, citing materially higher leverage, integration and execution risks, and uncertainty around achieving the targeted $6B of cost savings.

Impact on assets 3

Communication Services▼
Paramount Skydance Corporation
PSKY
▼ NegativeCapitalrelevance

Fitch downgraded Paramount's credit ratings on materially higher leverage, integration/execution risks, and uncertainty over $6B cost savings after the WBD acquisition closed.

Warner Bros Discovery Inc
WBD
± MixedCapitalrelevance

WBD notes were tendered/exchanged into new Skydance notes with higher coupons and retired as Skydance completed its acquisition of WBD.

Others▲
Skydance Corporation
SKYD
± MixedCapitalrelevance

Skydance completed its WBD acquisition and restructured the acquired debt via tender and exchange offers, issuing new higher-coupon notes.

Off-coverage companies 1

Fitch Ratingsi
Private± Mixedrelevance