Court Order Temporarily Blocks Cable One's Purchase of 55% Stake in Mega Broadband
Key Facts
Cable One announced on October 12, 2026, that the U.S. District Court for the Southern District of New York had temporarily barred it from buying the remaining 55% stake in Mega Broadband Investments. The restraining order was issued on October 9, blocking completion of the target company's transition to full ownership. Cable One said the court issued the order before any hearing or appearance by the company. The ruling came on the day to which Cable One and GTCR had extended the deadline for completing the purchase of the remaining stake. Under the acquisition agreement, Cable One is not required to close the deal while a legal impediment to completion remains in effect, according to the company's statement.
The lawsuit filed by lender CoBank rests on an allegation that payment for the Mega Broadband acquisition would constitute a "constructive fraudulent transfer," according to Cable One's statement. The lender holds about $1.1 billion in secured credit exposure to Cable One, according to Investing.com. The website cited CoBank's allegation that completing the acquisition would deepen the company's insolvency, a claim the creditor made in its lawsuit. Cable One responded that the lender's allegations were "legally incorrect." It added that it would challenge them, setting out its position on the legal basis CoBank cited in seeking to block payment for the acquisition.
Cable One's relationship with the target company dates to November 12, 2020, when it bought an initial 45% stake for $574.9 million in cash. On January 2, 2026, GTCR investors exercised a put option binding on Cable One, initiating the process of purchasing the remaining stake. When the acquisition was originally announced, Cable One estimated the expected consideration for that stake at about $475 million to $495 million. It also estimated Mega Broadband's expected net debt upon becoming a wholly owned subsidiary at about $845 million to $895 million. The debt estimate concerned the target company's position at closing, while the first range referred to the amount expected to be paid to acquire the remaining stake from its investors.
Mega Broadband provides services under the Vyve Broadband brand, according to Cable One's original statement announcing the deal. Its revenue totaled about $310 million in the twelve months ended September 30, 2025. Cable One said acquiring full ownership would expand the geographic diversity of its business. It added that greater scale would provide "opportunities to improve efficiency," among the reasons it gave for completing the purchase of the remaining stake. In the financing talks statement that preceded the court order, Stephen J. Jeschke, a managing director at GTCR, said the potential transaction would inject fresh capital into the business and highlight its untapped potential.
The dispute follows a decline in Cable One's revenue to $348.9 million in the second quarter of 2026, according to financial results announced by the company. Revenue had totaled $381.1 million in the same period of 2025. The company posted a net loss of $1.16 billion in the second quarter of 2026. Its net loss in the corresponding quarter of 2025 was about $438.0 million, according to the same earnings statement. In the stock market, an Investing.com report published on the day the lawsuit was filed said Cable One shares fell 34.3% to $10.10 in midday trading.
In its October 12, 2026, update, Cable One said it expected the proposed refinancing to address $2.45 billion in existing obligations and near-term debt maturities. The plan includes full repayment of the B-4 term loan, among the obligations the company aims to address. However, Cable One had not entered into definitive financing agreements when it announced the update. It said completion of the financing transaction was conditional on resolving the temporary restraining order or any other applicable legal impediment. Resolution of the court restriction thus became a stated condition for proceeding with the proposed financing, alongside its direct impact on completing the purchase of the remaining stake in Mega Broadband.