Bond Update: WBD proposes Consent Solicitation due to Paramount Offer: Details Broken Down for You

WBD's purpose in this contract amendment is to weaken the mandatory swap transaction commitments made in June 2025, simplify the capital structure, and reduce future refinancing risks.

iFAST Research Team
iFAST Research Team10 Jun 2026 72 Views
Bond Update: WBD proposes Consent Solicitation due to Paramount Offer: Details Broken Down for You

With Paramount Skydance ("Paramount") successfully obtaining the acquisition agreement from Warner Bros. Discovery ("WBD"), the transaction is expected to close within a year. Against this backdrop, WBD announced that in May 2026, that they solicited consent for deed amendments to nine USD bonds issued by its two issuers, Discovery Communications, LLC (DCL) and seven USD and EUR bonds issued by Discovery Global Holdings, Inc. (DGH, formerly WarnerMedia), involving approximately USD16.5 billion and EUR 700 million, respectively.


Background information: WBD originally planned to convert existing bonds into new ones

As early as June 2025, WBD had added a Required Exchange Transaction mechanism to all its senior unsecured bonds in response to potential acquisition plans. This mechanism arranges WBD to convert the bonds into Junior Lien Exchange Notes by December 30, 2026, in exchange for creditors agreeing to remove protective clauses such as restrictive liens and meet capital structure requirements of Paramount's offer.


The main amendments agreed upon the Consent Solicitation

This consent solicitation for core amendments to existing bonds includes but is not limited to:

1.      The activation period for Required Exchange Transactions has been extended from December 30, 2026, to March 4, 2027

  • Under the existing bond terms, WBD must make an exchange offer for the bonds before this specified date, swapping them for Junior Lien Exchange Notes; otherwise, it must pay bondholders an additional amount equivalent to 10% of the principal.

2.      If Paramount's acquisition is successfully completed, it will significantly weaken the protection of future subordinated lien exchange notes

  • The main changes include cancellation of par-for-par offer exchange requirements, removal of certain restricted debt repayment terms, and the use of subordinated lien exchange notes against pledged assets (mainly due to Paramount borrowing during its acquisition of WBD, which includes most of Paramount and WBD's assets). The order of claims drops below other secured debts, including the Second Lien Exchange Notes mentioned below.
  • Following the successful completion of the acquisition, Paramount's latest debt sequencing structure is: First Lien> Second Lien> Junior Lien> Subordinated Bonds


Paramount's exchange offer in Consent Solicitation

To attract creditors to agree to the covenant amendment, WBD proposed that eligible consentees would be eligible to participate in Paramount's concurrent exchange offer. The exchange offer allows existing unsecured WBD bonds to be exchanged for Paramount's second lien notes. In other words, under the new capital structure, the bond issuer will change from WBD to Paramount, and the bond seniority will be upgraded.

If bondholders agree to the deed amendment, they will receive USD/EUR 2.50 in cash (about 25 basis points) for every USD/EUR 1,000 principal.


Summary

In summary, WBD's purpose in this contract amendment is to weaken the mandatory swap transaction commitments made in June 2025, simplify the capital structure, and reduce future refinancing risks. The following table summarizes the impact of creditors agreeing to or refusing consent solicitation:

Agree

Refuse

Consent fee

If the deed amendment is approved, investors can receive a consent fee of approximately 25 basis points

If the contract amendment is passed due to meeting the threshold, investors will not receive a consent fee

WBD Bond Offer Eligibility

Eligible to participate in cash offers (applicable to 2027 and 2028 bonds) or swap offers (applicable to bonds from 2029 to 2052)

Cannot participate in Paramount's cash offer or exchange offer, but WBD's Required Exchange Transaction is allowed

Changes in bond issuers

The new bonds will be issued and guaranteed by Paramount

It will continue to be distributed by WBD (to be renamed DCL/DGH, a Paramount subsidiary)

Changes in bond seniority

  • New bonds are not affected by the Required Exchange Transaction 
  • Bonds will be exchanged to Second Lien Exchange Notes

  • Required Exchange Transaction still occurs
  • If bondholders participate in the Required Exchange Transactions, bonds will be exchanged to Junior Lien Exchange Notes

Bond value changes

Bonds are exchangeable at equivalent value without discount risk

If bondholders participate in the Required Exchange Transactions, existing bonds may be replaced with more discounted bonds

Can the transfer or sale be allowed during the consent solicitation period?

Non-transferable or non-sale (transferable or sold only after the consent solicitation is completed)

Maintain transferable or saleable status

Data source: WBD, iFAST compilations

Data as of 19 May 2026



Declaration: For specific disclosure, at the time of publication of this report, IFPL (via its connected and associated entities) holds positions in WBD 5.050% 15Mar2042 Corp (USD) and the analyst who produced this report holds a NIL position in the abovementioned securities.

All materials and contents found in this site are strictly for general circulation and informational purposes only and should not be considered as an offer, or solicitation, to deal in any of the funds or products found/identified in this site. While iFAST Financial Pte Ltd ("IFPL") has tried to provide accurate and timely information, there may be inadvertent delays, omissions, technical or factual inaccuracies and typographical errors. Any opinion or estimate contained in this report is made on a general basis and neither IFPL nor any of its servants or agents have given any consideration to nor have they or any of them made any investigation of the investment objective, financial situation or particular need of any user or reader, any specific person or group of persons. You should consider carefully if the products you are going to purchase are suitable for your investment objective, investment experience, risk tolerance and other personal circumstances. If you are uncertain about the suitability of the investment product, please seek advice from a financial adviser, before making a decision to purchase the investment product. Past performance is not indicative of future performance. The value of the investment products and the income from them may fall as well as rise. Opinions expressed herein are subject to change without notice. In respect of any matters arising from, or in connection with the said research analyses or research reports, recipients of the report are to contact IFPL at 10 Collyer Quay, #26-01 Ocean Financial Centre Building, Singapore 049315, or by telephone at +65 6557 2853. Where the report contains research analyses or research reports from a foreign research house and if the recipient of such research analyses or research reports is not an accredited investor, expert investor, institutional investor or an ex-accredited investor, IFPL accepts legal responsibility for the contents of such analyses or reports to such persons only to the extent as required by law. Please note that only certain security(ies) herein are available to all investors, while the rest are only available for certain persons to invest in, such as Accredited Investors (as defined in the Securities and Futures Act) or one who invests at least S$200,000 (or its equivalent currency) per transaction. To qualify as an Accredited Investor, one needs to submit a declaration form and certain relevant supporting documents, according to iFAST’s prevailing policies and procedures.

Please read our full disclaimers on the website at ( https://secure.fundsupermart.com/fsmone/policies/328125/investment-account-terms-&-conditions).

iFAST Financial Pte Ltd (IFPL) (registered address: 10 Collyer Quay #26-01 Ocean Financial Centre Singapore 049315, Telephone: 6557 2000) holds the Financial Advisers Licence issued by the Monetary Authority of Singapore ('MAS') to conduct regulated activities of advising on securities, marketing of collective investment schemes and arranging of any contract of insurance in respect of life policies, other than a contract of reinsurance and the Capital Markets Services Licence issued by the MAS to conduct regulated activities of dealing in securities and providing custodial services for securities. While IFPL has made every effort to ensure the independence of the report's contents, IFPL's nature of business is such that IFPL and its connected and associated entities together with their respective directors, officers and staff may be involved in providing dealing or investment-related services in the abovementioned securities, and have taken or may take positions in the securities mentioned in this report, and may also act as the principal for any buy or sell trades.