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Netflix Announces $2BN Junk Bond Offering, Enough To Fund Two Quarters Of Cash Burn

• https://www.zerohedge.com, by Tyler Durden

Terms of the deal were not announced and will be determined by negotiations between Netflix and the initial purchasers according to the press release, which also notes that Netflix will use the net proceeds from this offering "for general corporate purposes, which may include content acquisitions, production and development, capital expenditures, investments, working capital and potential acquisitions and strategic transactions." Translation: Netflix will continue spending millions to acquire subs and keep its recent trend of record subscriber growth.The new junk bond issue, which will likely end up being upsized to $2.5 billion, will push Netflix' total debt load above the current $8.4 billion to at least $10.5 billion and likely more. According to S&P, Netflix' adjusted leverage will rise to 4.8x by year end: a number that is dangerously high for a "growth company."

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