QXO secures $1.2 billion investment from Apollo for acquisitions

QXO Inc. (NYSE: QXO) announced that funds managed by Apollo Global Management Inc. (NYSE: APO) and other investors have agreed to invest $1.2 billion in the building products distributor through convertible perpetual preferred stock.

The investment will fund qualifying acquisitions through July 15, 2026, with the commitment extending up to an additional 12 months if a definitive acquisition agreement is executed before the initial period expires. The preferred stock issuance will close around the time of the qualifying acquisition closings.

The convertible preferred stock carries a 4.75% annual dividend rate and can be converted into QXO common stock at an initial conversion price of $23.25 per share. The securities are being offered in a private placement not registered under the Securities Act of 1933.

QXO describes itself as the largest publicly traded distributor of roofing, waterproofing and complementary building products in North America. The company has stated plans to reach $50 billion in annual revenues within the next decade through acquisitions and organic growth in what it characterizes as an $800 billion building products distribution industry.

The company has agreed to use commercially reasonable efforts to file a prospectus supplement with the Securities and Exchange Commission to register the resale of the new preferred stock and underlying common stock following issuance.

Apollo, which had approximately $908 billion of assets under management as of September 30, 2024, operates as a global alternative asset manager across investment grade credit to private equity.

You May Also Be Interested In