SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB
(Mark One)
[X]      QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
         SECURITIES EXCHANGE ACT OF 1934

         For the quarterly period ended    September 30, 1999
                                           ----------------------

[  ]     TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE
         SECURITIES EXCHANGE ACT OF 1934

    For the transition period from                    to
                                      ---------                ---------

                          Commission File No. 811-08469

                               ACORN HOLDING CORP.
        -----------------------------------------------------------------
        (Exact name of small business issuer as specified in its charter)

       Delaware                                             59-2332857
----------------------------------           ----------------------------------
(State  or  other  jurisdiction              (IRS  Employer  Identification No.
 of incorporation or organization

     1251 Avenue of the Americas, 45th Floor, New York, New York 10020-1104
-------------------------------------------------------------------------------
(Address of principal executive offices)                         (Zip code)

Issuer's telephone number, including area code      (212) 536-4089
                                                   --------------------
                                       N/A
--------------------------------------------------------------------------------
Former  name,  former  address and former  fiscal  year,  if changed  since last
report.

Check  whether the issuer (1) filed all reports  required to be filed by Section
13 or 15(d) of the Securities Exchange Act of 1934 during the past 12 months (or
for such shorter  period that the issuer was required to file such  reports) and
(2) has been subject to such filing requirements for the past 90 days.

        Yes               X                    No
               -----------------------            ------------------------

APPLICABLE ONLY TO CORPORATE ISSUERS:  State the number of shares outstanding of
each of the  issuer's  classes of common  equity,  as of the latest  practicable
date:  1,617,358  shares of common stock,  $.01 par value,  as of November 12,
1999 (which  reflects the  two-for-five  reverse stock split effective April 19,
1999).


<PAGE>
                      ACORN HOLDING CORP. AND SUBSIDIARIES
                       Consolidated Interim Balance Sheet
                    September 30, 1999 and December 31, 1998

                                          September 30, 1999  December 31, 1998
                                              (Unaudited)
                                 ASSETS
CURRENT ASSETS
  Cash and cash equivalents                   $  1,044,521    $  1,126,838
  Restricted cash                                      --           11,798
  Investment in marketable securities              215,887         668,439
  Accounts receivable - trade                      190,004          84,817
  Current portion of note receivable
     from sale of subsidiary                       110,236         110,235
  Current portion of note receivable
     - employee                                     40,000          40,000
  Inventories                                    1,897,287       2,055,827
  Prepaid expenses and other                        26,822          22,337
  Deferred income tax assets                       121,770          70,881
                                              ------------    ------------
  Total current assets                           3,646,527       4,191,172
                                              ------------    ------------
MACHINERY AND EQUIPMENT, net of accumulated
  depreciation of $2,501,046 as of
  September 30, 1999 and $2,255,282
  as of December 31, 1998                        1,880,419       1,978,743
                                              ------------    ------------
OTHER ASSETS
  Note receivable from sale of
    subsidiary, less current portion                   --          110,236
  Note receivable, less current
    portion - employee                              40,000          80,000
  Other investments                                  9,108           9,108
  Goodwill, net of amortization                    235,298         299,357
  Deferred income tax assets                     1,389,513       1,322,583
                                              ------------    ------------
  Total other assets                             1,673,919       1,821,284
                                              ------------    ------------
                                                 7,200,865       7,991,199
                                              ============    ============
       LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
  Current maturities of long-term debt             121,062         121,062
  Accounts payable                                  87,808          20,157
  Accrued expenses                                  87,770         127,021
  Machine purchase deposit liability                   --           11,798
  Deferred income                                  300,000         300,000
                                              ------------    ------------
  Total current liabilities                        596,640         580,038
                                              ------------    ------------
LONG-TERM DEBT, less current maturities             30,265         121,061
                                              ------------    ------------
DEFERRED INCOME                                    300,000         525,000
                                              ------------    ------------
DEFERRED INCOME TAXES                              196,694             --
                                              ------------    ------------

STOCKHOLDERS' EQUITY
  Common stock                                      40,684          40,684
  Additional paid-in capital                    11,823,449      11,823,449
  Accumulated deficit                           (5,769,490)     (5,083,839)
  Accumulated other comprehensive
   income (loss)                                   (17,377)        (15,194)
                                              ------------    ------------
  Total stockholders' equity                     6,077,266       6,765,100
                                              ------------    ------------
                                              $  7,200,865    $  7,991,199
                                              ============    ============
See accompanying notes.


<PAGE>


                      ACORN HOLDING CORP. AND SUBSIDIARIES
                  Consolidated Interim Statements of Operations
                    September 30, 1999 and September 30, 1998
                                   (Unaudited)

<TABLE>
<CAPTION>

                                         Three Months Ended             Nine Months Ended
                                           September 30,                  September 30,
                                           1999           1998            1999           1998

<S>                                    <C>            <C>            <C>            <C>
Net sales                              $   989,774    $ 1,704,344    $ 2,970,698    $ 5,901,353
                                       -----------    -----------    -----------    -----------
Costs and expenses
 Costs of sales                            814,828      1,210,695      2,508,816      4,156,296
 Selling, general
  and administrative                       328,801        418,441      1,097,902      1,347,817
                                       -----------    -----------    -----------    -----------

                                         1,143,629      1,629,136      3,606,718      5,504,113

 Operating profit (loss)                  (153,855)        75,208       (636,020)       397,240
                                       -----------    -----------    -----------    -----------
Other income (expense)
  Loss on investment                       (10,523)           --         (11,277)        18,000
  Interest income, net                      (1,853)          (637)        74,896         (2,556)
                                       -----------    -----------    -----------    -----------
                                           (12,376)          (637)        63,619         15,444
                                       -----------    -----------    -----------    -----------

  Income (loss) before income taxes       (166,231)        74,571       (572,401)       412,684
Income taxes expense (benefit)
  Current                                  (14,182)         3,727            --           7,513
                                                                                    -----------
  Deferred                                  37,256         58,378        113,250        117,702
                                       -----------    -----------    -----------    -----------
                                            23,074         62,105        113,250        125,215
                                       -----------    -----------    -----------    -----------

  Net Income (Loss)                    $  (189,305)   $    12,466    $  (685,651)   $   287,469
                                       -----------    -----------    -----------    -----------

Earnings (loss) per share                    (0.12)          0.01          (0.42)          0.17

Weighted average shares outstanding      1,627,362      1,518,157      1,627,362      1,686,853
                                       ===========    ===========    ===========    ===========
</TABLE>

See accompanying notes.


<PAGE>


                      ACORN HOLDING CORP. AND SUBSIDIARIES
                  Consolidated Interim Statements of Cash Flows
                    September 30, 1999 and September 30, 1998
                                   (Unaudited)

                                                 September 30,   September 30,
                                                      1999            1998

Net income (loss) from operations                $  (685,651)   $   287,469

Adjustments to reconcile net income
   to net cash provided by (used in)
   operating activities
  Depreciation                                       223,974        182,088
  Amortization                                        64,059         85,531
(Increase) decrease in assets
  Trade receivable                                  (105,187)        23,237
  Inventory                                          158,540        192,465
  Prepaid expenses                                    (4,485)       (25,865)
  Deferred taxes                                      78,875         61,340
  Deposits and other assets                           (3,184)       104,634
Increase (decrease) in liabilities
  Accounts payable                                    67,651       (158,411)
  Accrued expenses                                   (39,251)        (1,368)
  Deferred income                                   (225,000)      (350,011)
                                                 -----------    -----------
  Net cash provided by (used in)
   operating activities                             (469,659)       401,109
                                                 -----------    -----------

Cash flows from investing activities
  Purchase of property, plant and equipment         (125,650)      (518,009)
  Purchase of investments, net                       452,552       (110,518)
  Proceeds notes receivable                          150,236        184,618
                                                 -----------    -----------

  Net cash provided by (used in)
   investing activities                              477,138       (443,909)
                                                 -----------    -----------
Cash flows from financing activities
  Acquisition of treasury stock                          --      (2,265,966)

  Payment of debt                                    (89,796)       (90,795)
                                                 -----------    -----------

  Net cash used in financing activities              (89,796)    (2,356,761)
                                                 -----------    -----------

Net decrease in cash and cash equivalents            (82,317)    (2,399,561)

Cash and cash equivalents at beginning of year     1,126,838      2,882,526
                                                 -----------    -----------

Cash and cash equivalents at end of year         $ 1,044,521    $   482,965
                                                 -----------    -----------

See accompanying notes


<PAGE>
                      ACORN HOLDING CORP. AND SUBSIDIARIES
               Notes to Consolidated Interim Financial Statements
                               September 30, 1999
                                   (Unaudited)

NOTE A - ORGANIZATION AND PURPOSE

Interim financial  statements  reflect all adjustments which are, in the opinion
of management, necessary to a fair statement of the results for the periods. The
1998  balance  sheet has been  derived  from the  audited  financial  statements
contained in the 1998 Annual Report to  Stockholders.  These  interim  financial
statements  conform with the requirements for interim  financial  statements and
consequently do not include all the disclosures  normally  required by generally
accepted accounting principles.  The results for the three months ended June 30,
1999 are not  necessarily  indicative of the results to be expected for the full
year.  Reporting  developments  have been  updated  where  appropriate.  In this
connection,  there are no  significant  changes in  disclosures,  except for the
following:

Acorn  Holding  Corp.  filed  an  election  with  the  Securities  and  Exchange
Commission to be treated as a business  development company under the Investment
Company Act of 1940, as amended,  and operated as such until  November  1997. In
November  1997,  Acorn  Holding  Corp.  withdrew its  election as an  investment
company,  ceased to be a business development company, and commenced business as
an operating company. At that date, the name of the company was changed to Acorn
Holding Corp. The financial  statements presented reflect Acorn Holding Corp. as
an operating company.

NOTE B - NEW ACCOUNTING PRONOUNCEMENTS

The Financial  Accounting  Standards Board (FASB) issued  Statement of Financial
Accounting Standards (SFAS) No. 133 which amends the implementation date of SFAS
No. 133,  "Accounting  for  Derivative  Instruments  and Hedging  Activity." The
statement   establishes   accounting  and  reporting  standards  for  derivative
instruments,   including  certain  derivative   instruments  imbedded  in  other
contracts, and for hedging activities.  It requires that an entity recognize all
derivatives  as either  assets or  liabilities  in the  statement  of  financial
position and measure those instruments at fair value. If certain  conditions are
met, a derivative may be specifically  designated as a hedge. The accounting for
changes in the fair value of a  derivative  (gains and loses)  depends  upon the
intended use of the  derivative  and  resulting  designation.  The  statement is
effective for all fiscal quarters of fiscal years beginning after June 15, 2000.
The Company is currently reviewing the provisions of the statement.

The  American  Institute  of  Certified  Public  Accountants   ("AICPA")  issued
Statement of Option ("SOP") 98-1, "Accounting for the Costs of Computer Software
Developed  or  Obtained  for  Internal  Use."  The SOP  was  issued  to  provide
authoritative  guidance on the subject of  accounting  for the costs  associated
with the  purchase  or  development  of  computer  software.  The  statement  is
effective for fiscal years beginning after December 15, 1998. This statement has
been  implemented  and has no impact  on the  Company's  consolidated  financial
statements.


<PAGE>

NOTE C - REVERSE STOCK SPLIT

On April 19,  1999 the  Company  approved a  resolution  to amend the  Company's
certificate  of  incorporation  to decrease the  authorized  common  shares from
approximately  4 million to 1.3  million and to effect a 5-for-2  reverse  stock
split. Earnings per share and weighted average shares outstanding for al periods
presented have been changed to reflect the 5 for 2 reverse stock split.

NOTE D - LEGAL MATTERS

On May 14, 1999, the Chapter 7 Trustee in Bankruptcy for ServiceMax  Tire & Auto
Center of Michigan,  Inc.,  (ServiceMax) filed an avoidance action in the United
States  Bankruptcy Court for the Eastern District of Michigan seeking to recover
$1,750,000  from the Company.

ServiceMax Inc. is not included in the consolidated  financial statements of the
Company,  because the majority owned subsidiary's control does not rest with the
Company.

The  Company  has  filed an  answer  to the  avoidance  action  and  intends  to
vigorously defend this action.

<PAGE>

ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
          CONDITION AND RESULTS OF OPERATIONS

     Sales  for the  three-month  period  ended  September  30,  1999  decreased
$714,570 from the three-month  period ended September 30, 1998,  while sales for
the nine-month  period ended  September 30, 1999 decreased  $2,930,655  from the
nine-month  period ended  September  30, 1998.  The Company  incurred  operating
losses of $153,855  and  $636,020  for the three  months and nine  months  ended
September 30, 1999,  respectively,  as compared to operating  profits of $75,208
and  $397,240,  respectively,  over  the  comparable  prior  year  periods.  The
principal reason for the decline in profitability  was due to pricing  pressures
resulting   from  a  lower  demand  for  the  Company's   products,   without  a
corresponding decrease in the cost of sales. The Company does not foresee, based
on its present  orders,  an  increased  demand for its products for at least the
first quarter of the year 2000.

         Although  the  business  in which  the  Company  is  engaged  is highly
competitive and cyclical in nature and has been recently  incurring  losses from
operations, the Company believes that it has sufficient short-term and long-term
liquidity  either  from  cash on hand,  credit  arrangements  or cash  flow from
operations.

                                     PART II
                                OTHER INFORMATION

ITEM 1.   LEGAL PROCEEDINGS

         On May 14, 1999,  the Chapter 7 Trustee in  Bankruptcy  for  ServiceMax
Tire & Auto Centers of Michigan,  Inc.,  filed an avoidance action in the United
States  Bankruptcy Court for the Eastern District of Michigan seeking to recover
$1,750,000  from the Company on account of payments  made to the Company and its
subsidiary,  Automotive Industries,  Inc., during 1996 and 1997. The Company has
filed an answer to the avoidance action and will vigorously defend this action.

ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K

     (a)  Exhibits

         Exhibit No. 27 - Financial Data Schedule

     (b) Reports on Form 8-K:

     There  were no reports on Form 8-K filed by the  Company  filed  during the
quarter ended September 30, 1999.



<PAGE>


                                   SIGNATURES


         Pursuant to the  requirements  of the Securities  Exchange Act of 1934,
the  Registrant  has duly  caused  this report to be signed on its behalf by the
undersigned, thereunto duly authorized.


                                            ACORN HOLDING CORP.



Date: November 15, 1999
                                           Larry V. Unterbrink
                                           ------------------------------------
                                           Larry V. Unterbrink, Treasurer
                                             (Principal Financial and
                                             Accounting Officer)



                                           Stephen A. Ollendorff
                                           ------------------------------------
                                           Stephen A. Ollendorff,
                                             Chairman, Chief Executive Officer,
                                             and Secretary