Your friend is very lucky to have a friend like you. You are very right to be concerned. I can’t make a diagnosis on the basis of your letter but I can tell you that what you wrote suggests that losing his job and losing his sense that he was needed has put him over the edge. It’s possible that he is struggling with a depression with psychotic features. He needs more than your friendship. He needs to be evaluated by a professional mental health worker (psychologist) ASAP. Enlist his wife as a partner. She deserves to know what is going on. Make some calls and find a therapist or crisis team that will be willing to see him. Then do your best to get him there.
It probably won’t work to try to talk him out of his anger. It’s almost impossible to reason someone out of thinking that is so unreasonable. But maybe you can appeal to his sense of responsibility. You and his wife can remind him it won’t do his children any good to have their father in prison and to be the children of a murderer. Tell him that there are other ways for him to gain closure from what was a devastating experience for him. Murdering someone will only backfire on his family. Offer to drive him to the appointment and even to go with him if it will help him follow through.
If you aren’t successful, you and his wife should talk to the crisis team in your area and ask for advice about whether there are legal steps you can and should take to make sure both his ex and he stay safe.
I wish you well.