Paramount credit ratings downgraded by Fitch after Warner Bros deal

Group 1 - Fitch Ratings downgraded Paramount Skydance and Paramount Global's ratings to junk status due to the proposed acquisition of Warner Bros Discovery [1] - The acquisition is valued at $110 billion and is expected to close in the third quarter, backed by $54 billion in debt commitments [1] - Post-acquisition, the combined entity will have a net debt of approximately $79 billion, with Paramount's existing debt at $14 billion as of year-end 2025 [1] Group 2 - Fitch analysts anticipate "materially elevated leverage" for Paramount following the acquisition, with potential credit risks related to the debt-funded structure and limited visibility on financial policy [1] - Competitive pressures within the media sector and continued free cash flow challenges are also factors contributing to the downgrade [1] - Other rating agencies, including Moody's and S&P Global Ratings, have placed Paramount on watch for potential downgrades as well [1]