Warner Bros. Discovery subsidiary signed a $17.0 billion bridge loan on Jun 26, 2025 to help fund its debt tender offers

Written by Claude Sonnet 5.5, an AI model, from public records. Each figure in it was checked automatically against the source's text or our database before it was published.

WarnerMedia Holdings, a wholly owned subsidiary of Warner Bros. Discovery, signed a bridge loan agreement on Jun 26, 2025 for an 18-month term loan of $17.0 billion, with JPMorgan Chase Bank as administrative agent and the parent as guarantor. Warner Bros. Discovery reported the agreement in an 8-K, the filing a US-listed company makes when something material happens, under item 1.01 (a material agreement) and item 2.03 (a new financial obligation).1^,2^,3^,4

WarnerMedia Holdings said it intended to draw the full $17.0 billion on Jun 30, 2025, subject to conditions. The money was meant to finance the early settlement of the cash tender offers by it and other subsidiaries of the company, to repay and end a 364-day term loan dated Jan 28, 2025, and to cover fees, expenses and general corporate purposes. Those offers, in which subsidiaries offer to buy their own notes from holders, were launched on Jun 9 with payments capped at about $14.6 billion. On Jun 16 the company said it had the consents it sought to change the notes' contracts.5^,6^,7^,8^,9^,10^,11

Once drawn, the loan was to bear interest at SOFR, a benchmark dollar rate, plus 3.00% a year until Dec 30, 2025, 3.50% from Dec 31, 2025 until Mar 30, 2026 and 4.00% after that. The loan was to be secured by a lien on substantially all of the personal property assets of the parent, WarnerMedia Holdings and certain wholly owned domestic subsidiaries, and the parent and certain of those subsidiaries were to guarantee it. It was to fall due in full on the earlier of 18 months after funding and the day Warner Bros. Discovery distributed at least 80% of the common equity of a subsidiary that owns its Streaming & Studios business, the separation it announced on Jun 9. The loan had no required amortization and could be prepaid without penalty, subject to notice and minimum amounts, but certain debt incurrences, equity issuances or asset sales required prepayment. Covenants restricted, among other things, mergers, asset sales, new debt and liens, deals with affiliates and dividends without the approval of the required lenders, subject to thresholds and exceptions, and the agreement had no financial maintenance covenant, a test of financial ratios.12^,13^,14^,15^,16^,17^,18^,19^,20^,21

The same day, Discovery Communications, the parent and certain subsidiaries signed Amendment No. 1 to a revolving credit agreement dated Oct 4, 2024, a credit line that can be drawn and repaid. The amendment reduced the commitments to $4 billion, permitted the new debt and liens, changed some covenants to match the bridge loan's and provided for the facilities to end early when the separation completed. Its changes were to take effect only once the bridge loan was funded and certain other customary conditions were met.22^,23^,24^,25^,26^,27

Warner Bros. Discovery is the parent of Warner Bros. Games, which publishes Hogwarts Legacy and Mortal Kombat 1, among other titles. The 8-K calls the other subsidiaries that secure and guarantee the loan certain wholly owned domestic subsidiaries and refers to the loan agreement, Exhibit 10.1, for the full terms.28^,29^,14^,30

This article draws on the 8-K's own description of the agreements, not on the agreements themselves.30