QXO, Inc. (NYSE: QXO) has announced the intent of its wholly owned subsidiary, Queen Mergerco, Inc. ("Merger Sub"), to offer $2 billion in senior secured notes due 2032. This offering is part of the financing for QXO's previously announced acquisition of Beacon Roofing Supply, Inc. ("Beacon").
The proceeds from the notes offering, along with borrowings under new senior secured credit facilities, proceeds from QXO’s previously announced equity offerings, and available balance sheet cash, will be used to fund the transactions contemplated by the merger agreement and pay related fees and expenses.
Upon the completion of the acquisition, Merger Sub will merge with and into Beacon, with Beacon surviving as a wholly owned subsidiary of QXO. The notes will be guaranteed on a senior secured basis by each of Beacon’s wholly owned domestic restricted subsidiaries that guarantees Beacon’s new senior secured term loan facility.
The issuance and sale of the notes and the related guarantees are being offered and sold only to qualified institutional buyers in reliance on Rule 144A under the U.S. Securities Act and to certain non-U.S. persons in offshore transactions outside the United States in reliance on Regulation S under the Securities Act.
QXO aims to become the leader in the $800 billion building products distribution industry, targeting annual revenue of $50 billion in the coming decade through accretive acquisitions and organic growth. The company recently signed a definitive agreement to acquire Beacon Roofing Supply, Inc. for approximately $11 billion, which will make QXO the second-largest distributor of roofing products in the United States upon closing, expected the week of April 28, 2025. Additionally, QXO provides technology solutions to clients in the manufacturing, distribution, and service sectors. The market has reacted to these announcements by moving the company's shares -2.2% to a price of $12.86. Check out the company's full 8-K submission here.
