A New York federal court has paused Cable One’s plan to buy the remaining stake in Mega Broadband Investments. The decision arrived just before the $480 million deal was expected to close.
The temporary restraining order followed an emergency request from CoBank, one of Cable One’s lenders. CoBank argued the transaction could weaken its ability to recover outstanding loans.
The deal centers on the 55% of Mega Broadband that Cable One does not own. Mega Broadband owns Vyve Broadband, a cable and broadband operator. Vyve served about 210,000 customers as of September 2025.
For Cable One, the acquisition could bring greater control over a regional broadband footprint. It could also simplify ownership and long-term network planning. That matters as cable operators face slower broadband growth and stronger fiber competition.
However, the financing picture has raised serious concerns. Cable One ended the second quarter with $3.06 billion in gross debt. It also lost 17,400 broadband subscribers during that period.
CoBank holds about $1.1 billion in secured credit issued by Cable One. The lender claimed the $480 million transfer would reduce repayment prospects. It described the pending deal as a “fraudulent transfer.”
“Should this $480 million transfer occur, Cable one would sink deeper into insolvency and make Cable One’s remaining assets unreasonably small given its already large debts,” CoBank told the court. “Cable One is trending towards a bankruptcy proceeding.”
The market reacted sharply to the news. Cable One shares fell 26.78% on Friday, closing at $11.14. The stock had already dropped more than 90% in 2026 by October 9.
Before the court order, Cable One said it was in “advanced discussions” with GTCR, lenders, and new investors. Those talks focused on meeting capital needs and restructuring obligations.
The Wall Street Journal reported that Cable One was nearing $1.25 billion in new financing. The report said the money would help “address its balance sheet” and repay debt.
Cable One has rejected CoBank’s claims. The company noted that the court issued the order before any hearing.
Cable One said it “strongly believes CoBank’s claims are incorrect as a matter of law. Cable One intends to vigorously dispute these claims and protect its interests.”
The company also said it is not required to close the deal during any legal restraint. It added that proposed refinancing could address $2.45 billion in obligations.
Still, Cable One warned that financing remains uncertain. “The Company cautions, however, that no definitive financing agreements have been entered into thus far, and there can be no guarantee that any financing transaction will materialize,” Cable One said.
The next hearing will decide whether the deal can proceed. For broadband investors, the case highlights a wider issue. Expansion plans now face much closer scrutiny when debt pressure rises.
