Warner Bros. Bonds Cut to Junk by Moody's After Split Plan
(Bloomberg) — Moody's Ratings has downgraded debt issued by units of Warner Bros. Discovery Inc. (WBD), adding another complication to the media giant's discussions with bondholders after it announced plans to split in two.
Trump's Military Parade Has Washington Bracing for Tanks and Weaponry
NY Long Island Rail Service Resumes After Grand Central Fire
NYC Mayoral Candidates All Agree on Building More Housing. But Where?
Senator Calls for Closing Troubled ICE Detention Facility in New Mexico
California Pitches Emergency Loans for LA, Local Transit Systems
The credit rating company has downgraded the backed senior unsecured notes of Discovery Communications and WarnerMedia Holdings to Ba1 from Baa3, meaning the notes no longer qualify as investment grade. It also placed these ratings on review for downgrade.
The cut came after Warner Bros. Discovery said it would split into two independent companies, unshackling its fast-growing streaming business from the struggling legacy media channels. Moody's (MCO) rating action followed a similar move earlier this week by S&P Global Ratings, which cut Warner Bros. Discovery's bonds deeper into junk territory.
The downgrade reflects Warner Bros. Discovery's 'persistent operating challenges and a change in its financial policies to include secured debt in its capital structure pre and post separation,' wrote Moody's in a June 10 statement.
The company plans to refinance more than $14 billion of unsecured notes as part of the breakup, using $17.5 billion of secured bridge financing. That effectively puts new creditors ahead of unsecured noteholders.
The buyback plan has forced investors to make some difficult choices, since investors who sell back their notes must agree to give up some safeguards on other bonds they hold.
New Grads Join Worst Entry-Level Job Market in Years
The Spying Scandal Rocking the World of HR Software
American Mid: Hampton Inn's Good-Enough Formula for World Domination
Cavs Owner Dan Gilbert Wants to Donate His Billions—and Walk Again
The SEC Pinned Its Hack on a Few Hapless Day Traders. The Full Story Is Far More Troubling
©2025 Bloomberg L.P.
By subscribing, you are agreeing to Yahoo's
Terms
and
Privacy Policy
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Politico
18 minutes ago
- Politico
Trump revokes California's nation-leading electric vehicle mandate
President Donald Trump moved Thursday to eliminate California's nation-leading vehicle emissions standards, upending strict rules that had become a template for states across the nation to realize their greenhouse gas ambitions. Trump signed three Congressional Review Act resolutions rolling back a trio of California's rules at a White House signing ceremony, delivering on his Day 1 executive order to quickly roll back electric vehicle mandates around the country. 'We officially rescue the US auto industry from destruction by terminating California's electric vehicle mandate, once and for all,' Trump said at a Oval Office signing alongside House Speaker Mike Johnson (R-La.), Transportation Secretary Sean Duffy, Energy Secretary Chris Wright and EPA Administrator Lee Zeldin. The president, in a wide-ranging speech before the signing, used the moment to hit on a range of issues, including inflation, his disdain for windmills and his recent fallout with Tesla CEO Elon Musk. 'Now we know why Elon doesn't like me so much,' Trump quipped, before saying that Musk never asked him to save EV rules and that their break was over other 'smaller things.' While the Trump administration has also gone on the offensive against federal vehicle standards, California's regulations aimed at phasing out gas-powered passenger vehicles and heavy-duty diesel trucks — which are followed by a dozen other states — have drawn the stiffest opposition from the auto and fossil fuel industries. 'Worse than unachievable, these EV mandates were going to be harmful,' said John Bozzella, president and CEO of the Alliance for Automotive Innovation. 'Harmful to auto affordability, to consumer choice, to industry competitiveness and to economic activity.' The move takes place against the backdrop of worsening relations between Trump and Gov, Gavin Newsom, with the president ordering the military to quell unrest in Los Angeles over immigration raids. It also comes as Tesla CEO and former White House adviser Elon Musk clashed with Trump last week over electric vehicle policies. Trump's signature revokes the Golden State's unique permission to exceed federal vehicle pollution standards, which it's used for decades to set nation-leading rules. A dozen other Democrat-led states have opted to follow California's rules, representing one-third of the U.S. auto market. California's regulations aim to require automakers to sell increasing percentages of zero-emission vehicles, culminating in a 2035 target of all new-car sales being electric or otherwise carbon-free. Trump had targeted California's rules in his first term and on the campaign trail for his second term. EPA Administrator Lee Zeldin asked Congress to revoke them using the Congressional Review Act, which allows Congress to overturn rules passed in the waning days of the previous administration. The request triggered a debate among Republicans about whether to stretch congressional norms by using the CRA to roll back California's rules, which Senate Parliamentarian Elizabeth MacDonough and the nonpartisan Government Accountability Office have said aren't subject to the law. In addition to the rules for passenger vehicles, Thursday's signings roll back California's authority to enforce zero-emission sales targets for commercial trucks and higher standards for heavy-duty diesel engines. The fight over whether Congress acted lawfully will now head to the courts. California Gov. Gavin Newsom and Attorney General Rob Bonta said last month they would sue immediately after Trump signs the resolutions. The outcome of that court case will have widespread implications, as Democratic leaders seek to wean drivers and industry off fossil fuels and hit lofty greenhouse gas emissions reduction goals. But the question is especially acute for California, which has struggled for decades to reduce the nation's worst smog in the Los Angeles area and Central Valley and comply with federal air quality standards under the Clean Air Act. Failure to reach those standards could result in sanctions and withholding of federal highway funds, which both Republican and Democratic administrations have floated in the past. Trump's EPA threatened sanctions against the state in 2019, just days after the agency revoked an earlier version of its electric vehicle rules. 'It is hard to imagine that they will not threaten sanctions,' said Ann Carlson, who was head of the National Highway Traffic Safety Administration under former President Joe Biden. 'The president clearly has it out for California, and Los Angeles is obviously in his sights.' EPA said in a statement when asked about the possibility of sanctions that it will enforce the Clean Air Act. 'EPA will continue to implement the Clean Air Act as provided in law and will continue to hope that California can get into attainment after decades of nonattainment,' the agency said. EPA could develop its own plan for California to meet federal standards, though air quality experts say that's unlikely because the agency would have to take unpopular steps like restricting driving. California Air Resources Board spokesperson Lindsay Buckley said in a statement that without the waivers, the state will need to find an alternative to reach compliance. CARB chair Liane Randolph told state lawmakers during a hearing last month that she's 'confident California will prevail in litigation,' but that could take years, during which the rules are not enforceable. Randolph suggested that the state could consider approaches like district emissions rules for 'indirect sources' like warehouses that attract commercial trucks, incentives to encourage EV purchases and putting more funding towards public transit.
Yahoo
19 minutes ago
- Yahoo
GOP Megabill Boosts Wealthy Households While Hurting Poor, CBO Says
Middle-income Americans also would see gains from President Trump's agenda of tax reductions and spending cuts.
The Hill
20 minutes ago
- The Hill
Trump hints he may raise auto tariffs ‘in the not too distant future'
President Trump said Thursday that he may increase tariffs on automobile imports 'in the not-too-distant future.' 'To further defend our autoworkers, I imposed this 25 percent tariff on all foreign automobiles, and investment in American manufacturing and auto manufacturing—all manufacturing—is surging,' Trump said. 'And I might go up with that tariff in the not-too-distant future,' Trump added. 'The higher you go, the more likely it is they build a plant here.' His comments came at a White House event to block a California state rule that would ban the sale of new gas-powered cars by 2035. Trump touted incoming investments from Ford and General Motors, crediting his tariffs for those announcements. However, foreign carmakers like Hyundai have warned they may have to raise prices because of tariffs. The president has aggressively imposed — and pulled back — tariffs on various sectors, such as automobiles and steel and aluminum, while threatening additional tariffs on pharmaceuticals and other specific imports. He has also imposed a 10 percent blanket tariff on all imports while announcing and later suspending higher tariff rates on dozens of other nations.
