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

Disneyland
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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.

This article was printed from https://deadline.com/2020/04/walt-disney-5-billion-credit-agreement-1202907589/