Cable One (CABO) is being sued by lender CoBank ACB, which is seeking to block a planned $480 million payment for the remaining 55% of Mega Broadband Investments from private-equity firm GTCR, according to a complaint filed in federal court.

Cable One shares slumped 34% in Friday trading. The company said last week it is in advanced discussions with GTCR, some existing lenders and other private institutions on financing transactions.

CoBank, which holds about $1.1 billion in secured loans to Cable One, alleges the company is insolvent and that the transfer would further weaken its financial position and reduce assets available to creditors. Cable One valued its existing 45% stake in Mega Broadband at about $31.8 million as of June 30 after a large impairment, the suit said.

CoBank is seeking a temporary restraining order along with preliminary and permanent injunctions to prevent the transfer. The suit was filed in US District Court for the Southern District of New York.

Cable One did not immediately respond to a request for comment from MT Newswires.

Price: 10.11, Change: -5.27, Percent Change: -34.25