Capstone Accelerates Path to $100M Run-Rate; Signs LOI to Acquire $15M Stone Distributor-Immediately Accretive

Rhea-AI Summary

Capstone Holding Corp (NASDAQ:CAPS) signed a non-binding LOI on October 7, 2025 to acquire a multi-location stone distributor generating $15M in annual revenue. The acquisition is expected to be immediately accretive to revenue and EBITDA and to accelerate Capstone toward its $100M run-rate revenue goal targeted for early 2026. The planned deal targets closing within 45 days, is structured at about Net Asset Value, and contemplates roughly 50% of consideration in notes or contingent consideration. Completion depends on a definitive stock purchase agreement and customary conditions.

Positive

• Adds $15M annual revenue to Capstone platform
• Expected immediate EBITDA accretion upon closing
• Advances goal toward $100M run-rate by early 2026
• Expands geographic footprint and premium brand portfolio

Negative

• LOI is non-binding; closing depends on definitive agreement
• About 50% consideration in notes or contingent consideration
• Transaction priced at Net Asset Value, limiting immediate upside

Insights

M&A Analyst

LOI to buy a ~$15M stone distributor is growth‑accretive but remains conditional; closing and integration will determine impact.

Acquiring a multi‑location stone distributor with $15M in annual revenue would immediately add revenue and EBITDA to the platform and help reach the stated $100M run‑rate target for Q1 2026. The transaction is structured near Net Asset Value with roughly 50% of consideration in notes or contingent payments, which conserves cash and aligns seller incentives while limiting immediate dilution.

Key dependencies include completing a definitive stock purchase agreement, customary closing conditions, and timely integration of the acquired locations into existing operations. The LOI is non‑binding, so the positive headline is conditional; execution risk and any undisclosed liabilities could change outcomes. Monitor the definitive agreement, the actual purchase price terms, the mix of cash vs. contingent notes, and operational metrics (revenue retention and post‑close EBITDA) within the targeted 45 days closing window.

Expected close in 45 days; deal adds premium brands, expands footprint, and drives immediate revenue and EBITDA growth

NEW YORK CITY, NY, IL / ACCESS Newswire / October 7, 2025 / Capstone Holding Corp. (NASDAQ:CAPS), a national building products distribution platform, today announced it has signed a non-binding letter of intent ("LOI") to acquire a multi-location stone distribution business with $15 million in annual revenue.

The planned acquisition is expected to be immediately accretive to both revenue and EBITDA, further accelerating progress toward Capstone's $100 million run-rate revenue target for 2026.

Key Highlights:

• Transaction: LOI signed for the acquisition of a stone distributor (with ~$15M annual revenue), expanding Capstone's geographic presence.

• Financial Impact: Adds significant revenue ($15M) and is expected to boost EBITDA immediately upon closing.

• Valuation & Structure: Purchase price at about Net Asset Value, with roughly 50% of consideration in notes or contingent consideration.

• Strategic Fit: Broadens Capstone's footprint and premium brand portfolio, reinforcing scale and market leadership.

• Growth Target: Moves the company closer to its goal of a $100M revenue run-rate (targeted by early 2026).

• Closing Timeline: Subject to definitive agreement and customary conditions; targeting closing within 45 days.

The LOI is non-binding and subject to the negotiation of a definitive stock purchase agreement and other customary conditions.

"This LOI represents exactly the type of disciplined, growth-accelerating acquisition we seek," said Matt Lipman, CEO of Capstone Holding Corp. "It brings immediate revenue and EBITDA to our platform and moves us further toward our $100M run-rate revenue goal while expanding our customer base and geographic reach. The last time Capstone bought a business for about Net Asset Value was its acquisition of NEM, which was a big financial and strategic win. "

Growing the Platform with Discipline

If completed, the acquisition is expected to be at about Net Asset Value with about 50% in notes or contingent consideration. This disciplined approach to acquiring companies at attractive multiples supports sustainable long-term growth and value creation for shareholders.

"This announcement is further proof of our ability to execute on our strategy of building a scaled platform through disciplined acquisitions and organic growth," said Lipman. "In addition to immediate revenue and EBITDA growth, we've strengthened our positioning to capitalize on the projected wave of remodeling demand."

Capstone will continue pursuing acquisitions at attractive valuations. The company reaffirms its goal of $100 million in run-rate revenue in Q1 2026.

About Capstone Holding Corp.

Capstone Holding Corp. (NASDAQ: CAPS) is a diversified platform of building products businesses focused on distribution, brand ownership, and acquisition. Through its Instone subsidiary, Capstone serves 31 U.S. states, offering proprietary stone veneer, hardscape materials, and modular masonry systems. The company's strategy combines disciplined M&A, operational efficiency, and a growing portfolio of owned brands to build a scalable and durable platform.

Investor Contact

Investor Relations
Capstone Holding Corp.
investors@capstoneholdingcorp.com
www.capstoneholdingcorp.com

Forward-Looking Statements

This press release contains forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. These statements relate to future events and performance, including guidance regarding revenue and EBITDA targets, M&A strategy, use of capital, and operating outlook. Actual results may differ materially from those projected due to a range of factors, including but not limited to acquisition timing, macroeconomic conditions, and execution risks. Please review the Company's filings with the SEC for a full discussion of risk factors. Capstone undertakes no obligation to revise forward-looking statements except as required by law.

SOURCE: Capstone Holding Corp.

View the original press release on ACCESS Newswire

FAQ

What did Capstone (CAPS) announce on October 7, 2025?

Signed a non-binding LOI to acquire a stone distributor with $15M annual revenue.

How will the CAPS acquisition affect revenue and EBITDA?

The deal is expected to be immediately accretive to both revenue and EBITDA upon closing.

When does Capstone expect to close the CAPS stone distributor deal?

Targeting close within 45 days, subject to a definitive agreement and customary conditions.

How is the CAPS acquisition being structured?

Planned at about Net Asset Value with roughly 50% of consideration in notes or contingent consideration.

Does the CAPS LOI guarantee the acquisition will close?

No; the LOI is non-binding and closing requires negotiation of a definitive stock purchase agreement.

What impact does the deal have on Capstone's 2026 target?

The acquisition is intended to accelerate movement toward a $100M run-rate revenue target by early 2026.