On Friday, The a Walt Disney Company filed with the Securities and Exchange Commission, siting that they are looking to raise $6 billion in a new debt offering.
The company registered five different notes, set to mature between 2025 and 2050, with values of between $500 million and $1.75 billion, and interest rates between 3.35 percent and 4.7 percent.
Disney didn’t elaborate on what, specifically, the funds would go to. But in the filing, the company did say it plans to “use the net proceeds from the sale of the notes for general corporate purposes, including the repayment of indebtedness (including commercial paper).” Which gives the impression that the company may use the new offering to pay down other debt. At the end of the last fiscal year, Disney had a long-term debt totaling $38 billion.
The company signaled its intent to raise fresh cash in a filing with the SEC on Thursday. It also released a note to investors warning about the impact the novel coronavirus is having on its business, including disruptions to its sports and creative content, the closure of its theme parks, and lower advertising sales.
“We have closed our theme parks; suspended our cruises and theatrical shows; delayed theatrical distribution of films both domestically and internationally; and experienced supply chain disruption and ad sales impacts,” the company wrote in the note. “In addition there has been a disruption in creation and availability of content we rely on for our various distribution paths, including most significantly the cancellation of certain sports events and the shutting down of production of most film and television content.”
Disney is one of a number of large companies turning to the debt market in recent weeks. Coca-Cola, Exxon, Pepsi and Verizon have all sold debt offerings.
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