Cable One is nearing a deal to raise roughly $1.25 billion in new financing to address its balance sheet, according to people familiar with the matter.
The new first-lien term loan will be provided by both existing and new lenders, with proceeds going to pay down existing debt, the people said. Cable One is expected to announce the deal as soon as Friday, although terms are still being finalized, the people said.
The Phoenix-based broadband company said last week it was in advanced talks with private-equity firm GTCR, existing and new lenders to raise fresh capital.
Cable One faces a Friday deadline to complete its acquisition of the 55% remaining stake in Mega Broadband Investments that it doesn't already own. Cable One agreed to purchase that stake from MBI management and GTCR in January when GTCR exercised a previously agreed-upon right to sell its interest in the cable company. Last week, GTCR extended the purchase deadline to Friday.
Some existing lenders had pushed for a bankruptcy filing, arguing that costly new financing wouldn't address Cable One's problems over the long term as effectively as a chapter 11 process, some of the people said. The company continues negotiating with groups of existing investors that haven't signed up as of Thursday, the people said.
Cable One has roughly $2.3 billion of debt maturing in 2028, including convertible notes and a term loan, according to S&P Global Ratings, which downgraded Cable One deeper into junk territory last month. The ratings company said Cable One had drawn $700 million under its $1.25 billion revolving credit facility. The proposed deal is expected to include a reduction of the revolving credit facility to $700 million, one of the people said.
Mega Broadband has about $920 million in term loans due in November 2027, Cable One said in its most recent earnings report.
The company's shares have lost half their value over the past month, falling to $11.57 on Thursday intraday from $23 a month earlier.