CoBank sues to block Cable One’s $480 million Mega Broadband acquisition
CoBank, a major secured creditor of Cable One, filed a lawsuit in New York seeking an emergency restraining order to stop Cable One from transferring about $480 million to buy a 55% stake in Mega Broadband. The filing triggered a 34‑35% drop in Cable One shares, wiping out recent gains and prompting a trading halt. Cable One had been arranging a $1.25 billion term loan to fund the purchase and refinance existing debt. The dispute arises because CoBank values the stake at roughly $54 million and says the deal would worsen Cable One’s already fragile financial condition.
Why it matters
The lawsuit creates immediate uncertainty about whether the acquisition will close, leaving Cable One without the expected financing and potentially forcing it to seek alternative capital or restructure its debt. Investors face heightened credit risk and a likely further decline in the stock price until the legal outcome is known.
Key facts
- 1CoBank holds about $1.1 billion of secured credit against Cable One. investing.com
- 2Cable One plans to transfer roughly $480 million to acquire a 55% stake in Mega Broadband. investing.com
- 3CoBank values the Mega Broadband equity stake at $54 million, far below the purchase price. investing.com
- 4Cable One’s gross debt is approximately $3 billion. investing.com
- 5Cable One shares fell 34.3% to $10.10 after the lawsuit was announced. investing.com
- 6Cable One was pursuing a $1.25 billion first‑lien term loan to fund the acquisition and refinance debt. investing.com
Summary written by AlphAI AI Desk from 4 of 4 sources. Not investment advice. Figures are as stated by the linked sources.