QXO’s newly announced $1.2 billion equity commitment from funds managed by affiliates of Apollo Global Management underscores a broader shift reshaping wholesale distribution: scale and B2B e-commerce investment are increasingly moving in lockstep.
QXO said Monday the capital will be provided through a new series of convertible perpetual preferred stock and used to fund one or more acquisitions through July 15, 2026. The commitment can be extended for up to an additional year if the company enters into a definitive acquisition agreement before that deadline. Any issuance of the preferred stock will close at or near the completion of a qualifying acquisition.
For distributors, the structure highlights how private capital is being deployed with a clear mandate: accelerate consolidation while standardizing digital operations across acquired businesses. The preferred stock carries a 4.75% annual dividend and is convertible into common shares at an initial conversion price of $23.25 per share, tying investor returns directly to QXO’s execution on growth and integration.
QXO is the largest publicly traded distributor of roofing, waterproofing and complementary building products in North America. The company has made acquisitions central to its long-term strategy, pairing branch expansion with investments in technology that support online ordering, account-based pricing, credit management, and complex job-site fulfillment.
Those capabilities are becoming decisive competitive factors across distribution. Contractors and commercial buyers increasingly expect consistent digital experiences regardless of location, even as orders remain customized and logistics intensive. Distributors that lack the capital to modernize pricing engines, customer portals and fulfillment visibility face growing pressure from larger rivals that can spread those investments across broader footprints.
QXO has said it aims to become a technology-enabled leader in the estimated $800 billion building-products distribution market and has publicly targeted $50 billion in annual revenue within the next decade through a mix of acquisitions and organic growth. That ambition implies sustained deal activity and continued spending on scalable e-commerce platforms.
The Apollo-backed commitment also reflects a changing investor view of distribution businesses. Rather than treating ecommerce as a support function, financial sponsors are increasingly linking valuation and capital deployment to a distributor’s ability to integrate acquisitions onto a common digital operating model — improving pricing discipline, cross-selling and customer retention while reducing operational complexity.
The securities will be sold in a private transaction and have not been registered under the Securities Act of 1933. QXO said it plans to use commercially reasonable efforts to file a prospectus supplement with the Securities and Exchange Commission to register the resale of the preferred stock and the common shares issuable upon conversion following any issuance.
Apollo said the investment aligns with its strategy of providing long-term capital to companies pursuing growth through operational expansion and technology investment. As of Sept. 30, Apollo reported approximately $908 billion in assets under management.
Do not miss any content from Distribution Strategy Group. Join our list.
