Walt Disney Enters New $5 Billion Credit Agreement For Coronavirus Cushion, Follows $6 Billion Debt Sale Last Month

Walt Disney said Monday it’s entered into a new $5 billion, one-year credit agreement. That follows $6 billion the company raised last month with a sale of debt securities.
The current agreement matures in April of 2021 and could be extended for a year. It provides for advances to be made for a year to be used for general corporate purposes, the company said in a SEC filling.
Disney – and other companies – has been amassing a war chest to see it through the coronavirus pandemic, which has hit its divisions hard from theme parks to production to live sports and advertising. The agreements gives it a hefty extra $11 billion in fresh cash. It’s raising so much cash because its particularly exposed to the carnage of COVID-19 and because its can, as one of the entertainment industry’s largest and most credit-worthy companies.
Others have also been tapping the debt market or drawing down on revolving credit facilities as a nest egg against the harsh economic impact and unknown duration of the coronvirus, and acknowledging in SEC filings that the virus spread is having a major negative impact on their businesses, and the extent and duration of the hit is still impossible to gauge.
Fox Corp. most recently last week completed te sale of $1.2 billion worth of senior notes. Comcast has sold $6 billion of senior notes and ViacomCBS $2.5 billion worth. Discovery drew down a portion, $500 million, of a revolving credit facility to make sure it was available. AMC Entertainment has tapped all of its outstanding balance on two facilities, on here and one in the U.K.