BUZZ — Skydance slides as warrants trade separately; cost to insure debt hits record high

(Updates) * Skydance shares drop 25.9% to $6.87 * SKYD on Tuesday distributed 470.7 mln warrants to eligible holders, one for each share they own; exercise price is $12 per share, set to expire on October 13, 2036 * Buyers of the common stock no longer receive that right, so share price resets to reflect a distribution that now trades on its own * The warrants were last trading at $2.37 * Exercising of warrants can also lead to an increase in total number of common shares outstanding * Skydance corporate bonds have lost around 3 cents on the dollar since October 2, when they started to trade * The 2033 maturity last traded down 0.12 cents on the dollar, per Tradeweb data * Paramount Skydance completed its blockbuster $110 bln takeover of Warner Bros Discovery on October 6, with new co named Skydance * Combined co carries debt of about $80 bln * Both Fitch and S&P Global see Skydance's credit rating at "BB", which places it under the "junk" category * 5-year credit default swaps (CDS) hit an all-time high of 576 bps, according to S&P Global Market Intelligence data * The current levels of CDS imply a default probability of 39.5%,