Netflix to Raise $1.5B in Debt for Content and Other Expenses (Updated)

/ Feb 2, 2015

VIS_NetflixMoney

Netflix will take on more than a billion dollars in new long-term debt as it expands both the amount of content — original and acquired — that it offers to subscribers, as well as the number of territories its available in.

The company said that it intends to raise $1.5 billion in long-term debt, which will go toward “general corporate purposes,” which it said may include content acquisitions, capital expenditures, investments, working capital, and potential acquisitions and strategic transactions.

Update: Earlier Monday, Netflix said it planned to raise $1 billion in additional debt. That number grew to $1.5 billion by the evening, with the sale expected to close on February 5, 2015, subject to the customary conditions.

The announcement comes after Netflix’s Q4 2014 earnings report in January, when CEO Reed Hastings and CFO David Wells told shareholders that they plan to raise at least a billion dollars in debt.

“Over the next few years we expect to continue financing our original content expansion with long-term debt,” Hastings and Wells said in the letter to shareholders. “As long as the maturities are spread out, and the interest cost is built into our content budgets, we think long-term debt is the best way for Netflix to finance the production of content.”

Some of that could certainly go toward the company’s ambitious expansion plans — it hopes to be available in 200 countries within the next few years. That sort of reach also requires rights to offer content and original programming for those territories.

As for the debt itself, Netflix said the interest rate, redemption provisions, maturity date, and other terms will be determined by the negotiations it has with the initial purchasers.

Tags: , ,


lyor-cohen-youtube-music

Pioneering Hip Hop Exec Lyor Cohen Joins YouTube as Global Head...

 
alpha-legendary-digital

Legendary Digital Reveals Alpha Subscription Service Launch...

 
time-inc-jash

Time Inc. Teams with Digital Comedy Producers Jash for Branded Content

 
Amazon Logo

Amazon Greenlights Three Comedy Pilots as Series

 
Industry Tickets Selling Fast!
Click above to lock in your registration for VidCon 2015!
 
cartoon-network-app

How the Cartoon Network Combined the Best of VOD and Linear TV...

 
jukin-media-ethos

Jukin Media Goes Viral for Brands with Ethos Division Launch

 
Streamy Awards

Streamy Awards Trade In VH1 for YouTube, Again

 
zefr-alignment-report

Matching Ads to Videos Not So Simple, According to Zefr’s...

 
shomi

Plug Pulled on Canadian SVOD Service Shomi

 
Twitter

What’s Trending on the Twitter Sale

 
Machinima Logo

Machinima Teams with SiriusXM for Daily Esports Radio Show

 
Hearst

AwesomenessTV, Vice, Complex to Power New HearstLive...

 
dirty-30-hannah-hart-mamrie-hart-grace-helbig

VIDEO: ‘Dirty 30’ Confessions with Stars Hart,...

 
facebook-thumbs-down

Facebook Says It’s Sorry It Vastly Overestimated Video...

 
craig-piligian-pilgrim-media-group

Pilgrim Media Group CEO Craig Piligian (‘The...

 
youtube-heroes-for-change

Heroes or Rats?: YouTube Unveils New Program for Creators Who...

 
Vessel says it's doing well in its first month

Why Verizon is Pursuing Vessel, the...

 
jared-feldman-and-sam-hui-ph-d-at-the-2014-canvs-launch

How Canvs Media is Harvesting Emotional Insights on YouTube,...

 
marlon-wayans

Marlon Wayans Getting ‘Naked’ for Netflix with Regina Hall

 
huffpost-ryot-aol

HuffPost RYOT Launching Virtual Reality Comedy Series and News...

 
youtube-vote-irl

YouTube Launches #voteIRL Campaign Targeting Digital-First Generation

 
tyler-oakley-camp17

How Top YouTubers (incl. Tyler Oakley & Meghan Rienks)...

 
charlie-sheen-anger-management

Charlie Sheen to Star in Crackle Feature ‘Mad Families’

 
filmbuff_videoink_300x250

Gunpowder & Sky Buys Distributor FilmBuff As Vision for...

 
toy-freaks-youtube

Toy Freaks Top Viewed YouTube Channel in August According to...

 
jeffrey-tambor-transparent-amazon

Emmy Wrap-Up 2016: Jeffrey Tambor (‘Transparent’)...

 
Twitter

Twitter Scores 2.1 Million Viewers for Thursday Night Footall Kickoff

 
youtube-sad-face-error

Vloggers Not Unique Snowflakes: 90 Million Flag YouTube Videos...

 
Mode Media

‘Billion Dollar Startup’ Mode Media Shuts Down

 
raised-firsts-branded-tv

Who Is Winning The Marketing Revolution And Why?

 
shes-gotta-have-it

Netflix Orders ‘She’s Gotta Have It’ Series...

 
swedish-dicks-peter-stormare-keanue-reeves-viaplay

What Is ‘Swedish Dicks’ and Who Is Selling It?

 
seamlessly-she-monica-potter-aol-partner-studio-gmc-acadia

How GMC is Using the AOL Series ‘Seamlessly She’...

 
Netflix_new

Liberty Global to Put Netflix on Set-Top Boxes in 30 Countries

 
vincent-cacace-vertebrae

Getting to the Spine of VR’s Monetization Challenges with...

 
meredith_brandfront_videoink_300x250

Meredith Hosted Its Own “Front” Stacked with 20 New Series

 
complex-networks-hearst-verizon

Verizon and Hearst Move RatedRed.com and Seriously.TV Under...

 
Twitter

Twitter Launches Live Streaming Apps for Amazon Fire, Apple TV...

 
YouTube Community

YouTube Fights Back Against Social Media Rivals with Community Feature

 
Casual Hulu

Vimeo Opening Television Store with Lionsgate Content, Launching...