Robinhood shares gain on Q2 beat, as user and crypto growth accelerate
OLD GREENWICH, Conn. - Star Equity Holdings, Inc. (NASDAQ: STRR; STRRP), a diversified holding company with trailing twelve-month revenue of $50.38 million, has announced the acquisition of Alliance Drilling Tools, LLC (ADT), a provider of drilling equipment supply and repair services. According to InvestingPro analysis, Star Equity is currently trading near its 52-week low, with a market capitalization of $6.92 million. The transaction, which was finalized on Monday, aims to bolster Star’s growth strategy by adding a new Energy Services division.
ADT, established in 2009, is known for its rental, sale, and repair services of downhole tools in the oil and gas, geothermal, mining, and water-well industries. The company, with facilities in Texas, Wyoming, and Utah, reported a revenue of approximately $10.5 million for the full year 2024, with a gross margin of 48% and an Adjusted EBITDA of $2.4 million - notably higher than Star Equity’s current gross margin of 18.78%. For deeper insights into Star Equity’s financial health and growth potential, investors can access comprehensive analysis through InvestingPro, which offers exclusive ProTips and detailed financial metrics.
The acquisition values ADT at a cash-free, debt-free enterprise value of $12.65 million, including real estate estimated to be worth at least $3.0 million. The payment at closing included $4.9 million in cash—partially funded by $2.5 million of debt financing—and 775,000 shares of Star’s Series A Preferred Stock, equating to $7.75 million based on the stock’s liquidation preference.
Rick Coleman, CEO of Star, expressed enthusiasm for the addition of ADT to the company’s portfolio, citing ADT’s consistent growth and cash generation. Bruce McGovern, President and Founder of ADT, also welcomed the partnership, anticipating further growth under Star’s resources and platform.
Jeff Eberwein, Executive Chairman of Star, highlighted the acquisition’s alignment with Star’s strategy to build a multi-industry holding company. He emphasized ADT’s specialized industry knowledge and potential for strategic investments to meet increasing service demands.
ADT will maintain its brand and continue operations as a division of Star, which now comprises three business divisions: Building Solutions, Energy Services, and Investments. Star plans to commence a sale-leaseback process for the real estate acquired as part of the transaction.
The acquisition details, including financials, which are unaudited, can be found on the SEC website, indicating Star’s transparent approach to this significant expansion. This information is based on a press release statement from Star Equity Holdings, Inc.
In other recent news, Star Equity Holdings has implemented new annual bonus plans for senior employees of its subsidiaries, KBS Builders, Inc. and EdgeBuilder, Inc., along with Glenbrook Building Supply, Inc. These plans are designed around achieving adjusted EBITDA targets, with bonuses being distributed in cash and Series A Cumulative Perpetual Preferred Stock. Meanwhile, Star Equity Holdings has completed strategic real estate transactions involving its Prescott, Wisconsin property, resulting in net proceeds of approximately $24,562. The company sold the property to DWG Capital Partners (WA:CPAP), LLC and simultaneously entered into a 20-year leaseback agreement for continued operations. Under this agreement, Edgebuilder, a subsidiary of Star Equity, will pay an initial monthly base rent and cover all expenses related to the property. The lease includes potential renewal options and is backed by a security deposit that may be reduced if certain EBITDA targets are met. These developments reflect Star Equity’s strategic moves to incentivize key personnel and optimize its financial operations.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.