Netflix assumes 50 billion debt with Wall Street banks to finance the purchase of Warner Bros.

Netflix has brought about a new blow to the global streaming table with the purchase of Warner Bros. in a historic agreement valued at 72 billion dollars (about 62 billion euros at the current exchange rate) that has posed a dilemma among analysts: how does it plan to finance a transaction of such magnitude? The answer is due to a huge package of debt backed by some of the largest banks on Wall Street.

According to recent statements compiled by Bloomberg, Wells Fargo, BNP Paribas and HSBC will provide a unsecured bridge loan of 59 billion dollars (around 50 billion euros)one of the largest in history, to cover the bulk of the cost of the agreement. This type of loan is temporary and is typically replaced with more permanent debt, such as corporate bonds, a common strategy for large-scale financings.

The agreement contemplates that Warner Bros. shareholders receive $27.75 per share (23.82 euros), divided between cash and Netflix common shares, while the total enterprise value of the operation is around 82.7 billion dollars (almost 71 billion euros). Prior to closing, Warner Bros. will complete the spin-off of its cable television division, including CNN, TBS and TNT, which is expected to be completed in the third quarter of 2026.

Netflix, which has historically grown without depending on its own studios, takes a strategic turn with this purchase. With it, it becomes the owner of HBO and a wide catalog of iconic series and films, including franchises such as harry potter and The Sopranos. The acquisition not only expands its production capacity in the United States, but also promises to generate significant savings, estimated between 2,000 and 3,000 million dollars annually (from 1,700 to 2,500 million euros) from the third year.

Financing through a bridge loan is key for Netflix, as it allows Secure the necessary capital immediately while the issuances of long-term corporate bonds that will replace this temporary debt are structured. From another angle, the operation also strengthens Netflix’s relationships with global banks, which see these types of agreements as opportunities for future financial mandates.

While the news marks a milestone in the history of streaming and the film industry, it naturally also raises concerns regarding the financial burden and regulatory oversight. Netflix has agreed to pay a penalty of $5.8 billion (around €5 billion at the exchange rate) if the deal does not receive regulatory approval or fails for any reason, and the transaction is expected to close within 12 to 18 months.