Netflix, Inc. has entered into new credit agreements totaling $25 billion to support its proposed acquisition of Warner Bros. Discovery, Inc. (WBD), according to a regulatory filing with the U.S. Securities and Exchange Commission (SEC). The arrangements replace portions of an earlier bridge financing commitment and aim to provide funding for the cash portion of the merger deal, along with related expenses and potential debt refinancing.
The filing, a Form 8-K current report, details two separate credit facilities arranged with a consortium of lenders led by Wells Fargo Bank, National Association as administrative agent. The first is a Senior Unsecured Revolving Credit Agreement providing a $5 billion revolving credit line. This facility allows Netflix to borrow, repay, and reborrow funds as needed, with proceeds earmarked for merger-related costs, fees, and general corporate purposes, including working capital. The maturity date is set as the earliest of three years after the merger’s consummation, the merger agreement’s termination, or December 19, 2030. Netflix has the option to extend the term by up to one year, twice, under certain conditions.
Interest on borrowings under the revolving facility can be based on either an Alternate Base Rate plus a margin of 0% to 0.10% or a Term SOFR Rate plus 0.60% to 1.10%, depending on Netflix’s credit ratings. A 1% interest rate on $25 billion can be as high as $250 million a year.)
The second facility, outlined in a Senior Unsecured Delayed Draw Term Loan Credit Agreement, comprises a $10 billion two-year delayed draw term loan and a $10 billion three-year delayed draw term loan. These are designed for similar purposes as the revolving credit, with funds available on a delayed basis to align with merger timelines. Prepayments are allowed without penalty, except for breakage costs, but amounts repaid cannot be reborrowed.
These credit arrangements stem from a broader merger agreement signed on December 4, 2025, involving Netflix. The deal, if completed, would combine two major players in the streaming and entertainment industry, potentially reshaping content distribution and competition in the media landscape. Netflix plans to pay the cash component of the purchase price using these credit lines, while also covering transaction fees and possibly refinancing existing debt.
This financing move comes amid ongoing consolidation in the entertainment sector, where streaming giants seek scale to compete with rivals like Disney and Amazon by merging together and getting larger. As of the filing date, no specific merger closing timeline was provided, but the credit facilities are structured to support flexibility through at least 2030 if extended. This should give Netflix time to address any legal challenges before the line of credit expires.
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