Several readers have asked us what Paramount's acquisition of Warner Bros Discovery means for MEP. The deal cleared its last major hurdle this week when Paramount settled with the state attorneys general. The broader industry implications have been covered extensively elsewhere and since we don't typically finance studio-backed projects, our exposure comes from second-order effects.

Every few years, the film business convinces itself it has found a formula, which usually just means copying the last thing that worked for someone else. This season, it’s low-budget horror again.

This paper draws on MEP Capital's direct experience underwriting, acquiring, and lending against film and television libraries as well as the analytical frameworks developed by third-party valuation experts we work with. It is intended for investors and allocators as a framework: how to think about film library cash flows, how they decay, how they differ from music royalties (the more familiar benchmark), and what a lender must prepare for before committing capital.