Capstone Signs LOI to Acquire Southeast Stone Co.

Rhea-AI Summary

Capstone Holding Corp. (NASDAQ:CAPS) has signed a non-binding letter of intent (LOI) to acquire a Southeast-based distributor of thin veneer stone and hardscape materials. The strategic acquisition marks Capstone's expansion into the Southeastern U.S. market, targeting one of the fastest-growing construction markets in the country.

The target company specializes in serving residential and commercial builders and contractors. The acquisition terms align with Capstone's investment thesis for tuck-in deals, priced at 4x to 6x EBITDA with 20% to 45% non-cash consideration.

Capstone has reaffirmed its full-year targets of achieving a $100 million revenue run rate and $10 million in adjusted EBITDA. The company expects the acquisition to reduce freight costs, improve delivery times, and enhance customer service in the Southern region.

Positive

• Strategic entry into the high-growth Southeastern U.S. construction market
• Expected operational improvements in freight costs and delivery times
• Acquisition aligned with company's disciplined M&A strategy at 4x-6x EBITDA
• Reaffirmed strong financial targets of $100M revenue run rate and $10M adjusted EBITDA

Negative

• LOI is non-binding and subject to definitive agreement
• Significant portion of consideration (20-45%) in non-cash form

Reaffirms its full-year target of a $100 million revenue run rate

NEW YORK CITY, NEW YORK / ACCESS Newswire / July 1, 2025 / Capstone Holding Corp. (NASDAQ:CAPS), a national building products distribution company, today announced it has signed a non-binding letter of intent ("LOI") to acquire a Southeast-based distributor of thin veneer stone and hardscape materials.

The planned acquisition marks Capstone's entry into the Southeastern U.S. market - a key region in the company's expansion strategy. The target business is known for its strong relationships with residential and commercial builders, and contractors.

"This move extends our national footprint into one of the fastest-growing construction markets in the country," said Matt Lipman, CEO of Capstone Holding Corp. "We're excited by the opportunity to partner with a proven operator and expand our wholesale stone product offerings in this high-growth region. With our platform, we see clear opportunities to reduce freight costs, improve delivery times, and better serve an expanding customer base in the South."

The LOI is non-binding and subject to the negotiation of a definitive stock purchase agreement and other customary conditions. If completed, the acquisition would represent another step in Capstone's strategy to scale through disciplined M&A, targeting strong local operators in growing markets. The purchase price is in line with the formula presented to investors in the Company's investment thesis for tuck-in deals - 4x to 6x EBITDA with 20% to 45% non-cash consideration.

Capstone continues to pursue acquisitions at attractive valuations while reaffirming its full-year targets of a $100 million revenue run rate and $10 million in adjusted EBITDA.

About Capstone Holding Corp.

Capstone Holding Corp. (NASDAQ:CAPS) is a diversified platform of building products businesses focused on distribution, brand ownership, and acquisition. Capstone's Instone subsidiary currently serves 31 U.S. states, with proprietary offerings including stone veneer, landscape stone, and modular masonry systems. Capstone's strategy blends organic growth with disciplined, accretive M&A, supported by a shareholder-aligned capital structure. Learn more at www.capstoneholdingcorp.com.

Investor Contact:

investors@capstoneholdingcorp.com

Forward-Looking Statements

This press release contains certain "forward-looking statements". These forward-looking statements involve known and unknown risks and uncertainties and are based on the Company's current expectations and projections about future events. Investors can find many (but not all) of these statements by the use of words such as "may," "will," "expect," "anticipate," "estimate," "intend," "plan," "believe," or other similar expressions. The Company undertakes no obligation to update or revise publicly any forward-looking statements to reflect subsequent events or circumstances, except as may be required by law. Although the Company believes that the expectations expressed in these forward-looking statements are reasonable, it cannot assure investors that such expectations will turn out to be correct, and the Company cautions that actual results may differ materially from anticipated results. Additional factors are discussed in the Company's public filings with the Securities and Exchange Commission, available for review at www.sec.gov.

SOURCE: Capstone Holding Corp.

View the original press release on ACCESS Newswire

FAQ

What company is Capstone (NASDAQ:CAPS) planning to acquire in 2025?

Capstone has signed an LOI to acquire a Southeast-based distributor of thin veneer stone and hardscape materials, marking its entry into the Southeastern U.S. market.

What are the financial terms of Capstone's planned Southeast Stone acquisition?

The acquisition is priced at 4x to 6x EBITDA with 20% to 45% non-cash consideration, aligned with Capstone's investment thesis for tuck-in deals.

What are Capstone's (CAPS) revenue targets for 2025?

Capstone has reaffirmed its full-year targets of achieving a $100 million revenue run rate and $10 million in adjusted EBITDA.

How will the Southeast Stone acquisition benefit Capstone's operations?

The acquisition is expected to reduce freight costs, improve delivery times, and enhance customer service in the Southern region while expanding Capstone's presence in one of the fastest-growing construction markets.

Is Capstone's Southeast Stone acquisition final as of July 2025?

No, the letter of intent (LOI) is non-binding and subject to the negotiation of a definitive stock purchase agreement and other customary conditions.