QXO appears to expect its next major acquisition to happen soon.

One week after announcing $1.2 billion in new equity funding led by Apollo Global Management, the building materials distributor announced that funding has been increased by $1.8 billion after Apollo, Tamesek and other investors added equity via convertible perpetual stock.

The combined $3 billion in new funding further strengthens the company’s financial flexibility to pursue strategic acquisitions following its $11 billion purchase of Beacon in mid-2025.

As with the Apollo funding shared on Jan. 5, the expanded investment agreement says the investors committed the new stock to fund one or more qualifying acquisitions through July 15 of this year, and the commitment will extend up to another 12 months if a definitive acquisition agreement is executed by that date.

People familiar with the matter told MDM that the new $1.8 billion investment placement was oversubscribed, coming from a mix of mutual funds, sovereign wealth funds, large family offices, blue-chip institutional pension plans and insurance companies that include Apollo, Temesek, PGIM (formerly Prudential), Morgan Stanley Investment Management, Iconiq, AllianceBernstein, Liberty Mutual, Clearbridge Investments and Canadian pension funds BCI and AIMCO.

As they did a week earlier, that same source reaffirmed that QXO is in advanced stages of completing another significant acquisition and is in deep discussions with seven targets that would represent a mix of mid-sized deals ($1B to $5B in revenue) and “transformational” deals (more than $5B). Several of those targets are private, family-owned companies, the source added, and are in both the U.S. and Europe.

Ever since the Beacon deal, QXO has repeated its longer-term goal of achieving $50 billion in annual revenue over the next decade. Beacon achieved approximately 20% of that goal.

A QXO spokesperson told MDM last week that the company’s target outcome is to essentially double an acquired company’s EBITDA within three to five years through integration, technology upgrades and disciplined cost management. Founder and CEO Brad Jacobs has spoken at length on this when detailing QXO’s plans to enhance Beacon.

As of Dec. 31, Jacobs has stepped down from his chairman roles at XPO and GXO Logistics in a move that lets him focus more on QXO, which he launched in late 2023.

MDM’s Take

As we noted last week, the new funding suggests that QXO is positioning to land its second major acquisition to follow Beacon and gearing up for a big 2026 of platform expansion.

A persistently weak industrial demand environment is working in QXO’s favor, creating a period of lower valuations for building materials distributors and helping their affordability for serial acquirers. This is evidenced by what we saw in 2025 M&A, with building materials dominating the category field for our annual M&A count, and by a wide margin. 

While QXO’s stated new investment placement is contingent upon a July 15 acquisition deal deadline, we expect such a transaction agreement to occur sooner. Our source familiar with the matter told us that the likelihood of QXO announcing a transaction in the coming weeks or months is high.

After hitting a recent low of $16.10 on the New York Stock Exchange, QXO’s share price ended 2025 at $19.29 before jumping to $23.30 when the company announced the first $1.2 billion in new funding on Jan. 5 and was north of $25 the morning of Jan. 12 upon the expanded funding news.