PARAMOUNT IS BORROWING $44 BILLION TO BUY A COMPANY SIX TIMES ITS SIZE

Paramount Skydance spent Monday on investor calls hawking about $44.4 billion of secured bonds, roughly $32 billion of it investment grade and $12.4 billion of it junk. Add last week's $7.5 billion term loan and the permanent financing package runs to $51.9 billion. All of it is fuel for the $110 billion Warner Bros. Discovery takeover. Worth noting who is eating whom here. Paramount's market cap is around $11.5 billion. Warner's is around $77.4 billion. The combined company comes out the other side carrying roughly $80 billion in debt with annual interest well over $6 billion. Bond buyers did not flinch. The $12.4 billion second-lien piece is the largest high-yield offering on record and it pulled in more than $23 billion of orders at yields running up near 9%. The leverage math depends entirely on who you ask. Paramount tells lenders net leverage lands at 4.3x at close once synergies are counted, with investment grade credit metrics in three years. S&P ran it and got 7.6 times EBITDA, parked there through 2027. David Ellison has promised more than $6 billion in synergies, and everyone at Warner knows what that word actually buys. Also, the deal isn't closed. Judge Araceli Martinez-Olguin still hasn't approved the antitrust settlement with 12 state attorneys general. Paramount penciled in October 7 anyway, because a ticking fee of about $7 million a day starts October 1 whether the judge is ready or not.

Why you should give a shit: Ellison is buying Hollywood's biggest library with $80 billion of borrowed money and a $6 billion synergy promise, which means the next decade of Batman gets greenlit by whoever owns the 9% notes.