Cable One lender sues to block $480 million deal
CoBank sued Cable One to stop its planned $480 million purchase of the remaining stake in Mega Broadband Investments, calling the financing a fraudulent transfer. Cable One shares fell more than 34% after the filing.
By Alicia McElhaney and Samantha Kroontje A lender to Cable One sued the broadband company Friday to stop it from buying the remaining stake in Mega Broadband Investments, saying the financing hinders Cable One's ability to repay its creditors. S. 1 billion of Cable One's debt under a revolving credit facility and term loans. Cable One carries an additional $2 billion in outstanding debt, according to the lawsuit.
38 on Thursday after news of proposed financing. 25 billion new first-lien term loan, WSJ Pro Bankruptcy reported Thursday. The financing package, which CoBank said includes "unfavorable terms," remains on track to close as soon as Friday, people familiar with the matter said. CoBank said the financing's all-in costs, including its interest rate, are about 17% through September 2029.
The deal makes any future refinancing difficult and "dooms" the company to a negotiated restructuring in which lenders forgo repayment or it files for bankruptcy, CoBank said. 25 billion financing that could help stave off a bankruptcy filing, the people said. The company would be better off filing for chapter 11, which would allow it to address the debt burden without spending $480 million for the acquisition, the people said. Cable One is contractually obligated to purchase the remaining stake it doesn't own after GTCR, its private-equity sponsor, exercised its right to sell in January.
Cable One is expected to complete the acquisition by Friday. Cable One has said the $480 million purchase is effectively worth no more than about $54 million after accounting for a $426 million liability associated with the deal, according to CoBank's lawsuit. Cable One's shareholder equity and GTCR's investments would likely be extinguished if the company were to file for bankruptcy. com (END) Dow Jones Newswires October 09, 2026 13:37 ET (17:37 GMT) Copyright (c) 2026 Dow Jones & Company, Inc.
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