Paramount’s $57.5 Billion of Warner Debt to Mix Junk, High Grade

Paramount Skydance Corp.’s takeover of Warner Bros. Discovery Inc. is expected to feature an unusual combination of investment-grade and junk-rated debt, as Wall Street banks turn to as many markets as possible to raise $57.5 billion of debt for the acquisition.

A trio of lenders are initially providing temporary financing, which will be refinanced with about two-thirds or more investment-grade debt and the rest in high-yield bonds, according to people familiar with the matter. Typically, borrowers opt for either investment-grade financing or leveraged financing, rarely both in combination.

The high-grade debt is expected to include loans and senior secured ...