Netflix's $72B Warner Bros. bid: Debt surge, rating risk, but credit strong.

• Netflix plans to acquire a majority stake in Warner Bros. Discovery Inc. for $72 billion, financed by significant new debt.
• The acquisition involves $59 billion in temporary bank debt, to be replaced by $25 billion in bonds, $20 billion in term loans, and a $5 billion credit facility.
• Paramount Skydance Corp. has launched a competing hostile takeover bid for Warner Bros. at over $108 billion.
• Analysts note potential risks including a credit rating downgrade for Netflix, despite its improved balance sheet and current A/A3 ratings.
• Post-acquisition, Netflix's total debt could reach $75 billion, with a projected net debt-to-EBITDA ratio of 3.7x, expected to de-lever to mid-2x by 2027.

Why It Matters: Netflix's huge debt for Warner Bros. bid poses financial risks and industry shifts.