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GREENWICH, Conn. - QXO, Inc. (NYSE: QXO), a major distributor in the building products industry with a market capitalization of $9.55 billion, has announced concurrent public offerings of its common stock and depositary shares, aiming to raise an aggregate of $1.0 billion. According to InvestingPro data, the company maintains a strong balance sheet with more cash than debt, and an impressive current ratio of 95.23. The company also plans to provide options for underwriters to cover over-allotments which could potentially bring in an additional $150 million.
The offerings, which are separate and not contingent upon each other, include common stock and depositary shares representing a 1/20th interest in QXO’s new Series B Mandatory Convertible Preferred Stock. The proceeds are intended for repaying debts under the company’s senior secured term loan facility, positioning QXO for potential future acquisitions. While the company’s stock has shown strong momentum with an 11.32% return over the past week, InvestingPro analysis suggests the stock is currently trading slightly above its Fair Value. Subscribers can access 13 additional exclusive insights about QXO’s financial health and market position.
Each holder of the depositary shares will have a proportional interest in the rights of the Mandatory Convertible Preferred Stock, which includes conversion, dividend, liquidation, and voting rights. The Mandatory Convertible Preferred Stock is set to automatically convert into common stock on or about May 15, 2028, unless converted earlier, with the conversion terms to be determined at the time of the offering’s pricing.
Currently, there is no public market for the depositary shares or the Mandatory Convertible Preferred Stock, but QXO intends to list the depositary shares on the New York Stock Exchange under the symbol "QXO.PRB."
Goldman Sachs & Co. LLC and Morgan Stanley are the lead joint bookrunning managers for the offerings, which are being made by means of a prospectus supplement under QXO’s effective registration statement on Form S-3ASR, filed with the Securities and Exchange Commission.
This announcement comes as QXO aims to become a tech-enabled leader in the $800 billion building products distribution industry, targeting $50 billion in annual revenues within the next decade through strategic acquisitions and organic growth. Analysts tracked by InvestingPro project significant revenue growth of 43.92% for fiscal year 2025, though profitability remains a challenge in the near term. Get deeper insights into QXO’s growth trajectory and financial metrics with an InvestingPro subscription.
The information in this article is based on a press release statement from QXO, Inc.
In other recent news, QXO, Inc. has completed its acquisition of Beacon Roofing Supply, Inc. for approximately $11 billion, marking a significant expansion in the building products distribution industry. This acquisition positions QXO as the largest publicly traded distributor of roofing and related products in the U.S. The transaction was supported by an $830 million equity private placement, and Beacon has become a wholly owned subsidiary of QXO. To facilitate this acquisition, Morgan Stanley and Goldman Sachs led a $4 billion junk-debt sale, with a $2 billion leveraged-loan offer and a seven-year junk-bond sale. Additionally, QXO’s subsidiary, Queen MergerCo, Inc., plans to offer $2 billion in Senior Secured Notes, further financing the acquisition.
QXO also announced a $500 million stock offering, with underwriters having the option to purchase an additional $75 million of shares, to partially fund the Beacon acquisition. In another development, QXO appointed Val Liborski as its new chief technology officer, effective April 21, 2025. Liborski brings extensive experience from his previous roles at Yahoo, HelloFresh, and Amazon, among others. These strategic moves align with QXO’s goal of reaching $50 billion in annual revenues over the next decade through acquisitions and organic growth.
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