1. The Clorox Company Strategic Opportunities
Discussion Materials | December 17, 2014

2. Our Team
Grant Sternberg
Aamani Paturi
Alexander Roesch
Robert Liu
• Indiana University, Kelley School of Business, 2016
• Majors: Finance & Accounting
• Investment Banking Workshop, 2016
• Indiana University, Kelley School of Business, 2016
• Majors: Finance & Accounting
• Investment Banking Workshop, 2016
• Indiana University, Kelley School of Business, 2017
• Majors: Finance & Economic Consulting
• Investment Banking Club, Co-President
• Indiana University, Kelley School of Business and College of Arts & Sciences, 2017
• Majors: Finance, Accounting & Mathematics
• Investment Banking Club, Co-President
2

3. Table of Contents
I. Executive Summary
II. Macroeconomic Outlook & Industry Analysis
III. Company Positioning
IV. Strategic Options
V. Financial Analysis
VI. Execution
VII. Appendix
3
4
6
10
14
23
33
36

4. I. Executive Summary

5.  Limited growth because of broad category exposure and elevated risk due to commodity exposure
 In recent years, inorganic growth has been stimulated through the purchase of professional medical healthcare companies to
strengthen product offerings and expand industry expertise
 Lofty valuation given flat historical sales growth
 Cleaning and household, the two largest segments are struggling but forecasted to recover
 Lastly, operating challenges in Venezuela and Argentina from currency devaluation, coupled with price controls, have had a
significant impact on several household product manufacturers
Executive Summary
Overview
Current Positioning
 Management temperament appears to run counter to a sale – a 15x offer from an undisclosed competitor was recently rejected
 A leveraged buy out runs counter to historical debt tolerance levels, the industry is moving away from large public-to-private
transactions, and the required return for a financial sponsor requires too low of a purchase multiple
 Low organic growth, especially in comparison to competitors, makes the status quo less than ideal
 A divestiture unlocks liquidity for Clorox to return proceeds to shareholders, pivot into emerging markets, and provides capital for
future investment opportunities and growth initiatives
Strategic Alternatives Assessment
We recommend the CLX Board of Directors divest the Kingsford brand for 16.0x EV/EBITDA through a
targeted auction process
 Discretionary spending is projected to increase resulting in greater consumer purchasing power moving forwards
 Emerging markets are not growing as fast as they have been projected to in past years
 Emerging markets outside of the US provide better growth opportunities, organic sales growth is projected to be slightly better in 2014
 Cost of debt is cheap and projected to increase in coming years
 Growth in the consumer durables industry will be driven by innovation and a focus on core competencies
5

6. II. Macroeconomic Outlook & Industry Analysis

7. Macroeconomic Outlook
10312
10373
10448
10497
10541
10585
10644
10692
10744
10832 10844
10913
Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
USDBillion
2011
United States Consumer Spending
2012 2013 2014
Domestic
International
 With 2014 coming to a close, economic outlook for the U.S. is
positive overall
 The U.S. economy shows strong signs of recovery while
still driving for more growth
 Discretionary spending is projected to increase resulting
in greater consumer purchasing power moving forward
 Cost of debt is cheap and projected to increase
 Low cost of oil will reduce inputs costs and drive profitability
 Emerging markets outside of the US provide better growth
opportunities although organic sales growth is projected to be
slightly better in 2014
 Economic growth in East Asia is projected to slow modestly to
7.0% by 2016
 Rising societal tensions in Middle East and North Africa
 Widening income disparities
 Expanding middle class in Asia
 The International Monetary Fund called global growth
“mediocre” in October in its latest outlook
 Chief Economist Olivier Blanchard wrote that “secular
stagnation in advanced economies remains a concern”
 Emerging markets are not growing as fast as they have been
projected to in past years
-3%
-2%
-1%
0%
1%
2%
3%
4%
5%
6%
2005 2006 2007 2008 2009 2010 2011 2012 2013
Percentage(%)
GDP Growth (Annual Percentage)
7

8. Consumer Nondurables Industry Overview
 Slow growth in income levels, and tighter purchasing power has continued the
emphasis on value products
 Private labels continuing to gain popularity because of their emphasis on value
 Unilever NV’s sale of its global Skippy business to Hormel Foods in November 2013 for
about $700 million; P&G focusing on its core brands; Energizer planning to split into
two firms; and Kimberly-Clark planning a spin-off of its healthcare business in 2014
Emphasis on Value Products
Increasing Number of Divestitures
Innovation
Restructuring
General Outlook
Consumer nondurables are generally less sensitive to economic conditions, however the challenge is in battling for a limited share
of consumer spending. Slow growth in the US population and the number of households means that the development of new
products and categories remains important to growth in the industry. Emerging markets outside of the US provide better growth
opportunities although organic sales growth is projected to be slightly better in 2014.
Trends
 New products can lift profits: innovation keeps consumers from defecting to less
expensive private label products that do not have the same features and may benefit
from the historical consumer trend of trading up to better products that cost more
 Because of high input costs, most of the household and personal care companies began
significant restructuring programs in 2011–2012 to cut costs and slim product lines
 Companies that have done this include: Kimberly Clark, P&G, and Colgate
8

9. Industry Analysis By Segment
Cleaning
Household
Lifestyle
International
32%
21%
17%
30%
 Industry revenue expected to grow at 1.5% during next five years - driven by a demand
from downstream markets including restaurants as consumer disposable income raises.
 Foreign manufacturers in addition to private labels are pressuring domestic demand
 Emerging markets and green product development will facilitate future growth.
Consumer demand has plateaued due to stagnant population growth.
 Bags and wraps industry projected to continue to grow at 2.6% due to consumer
demand for packaged products
 Price increases and stiff competition has caused decline in demand and sales volume for
this product group
 Projected increase in consumer disposable income will increase demand in coming
years
 Sales increase solidly due to reduced trade promotion spending
 Sales and volumes increased grew on account of increased merchandising support
 Burt’s Bees: sales and volume showed strong increase due to increased demand and
popularity for cosmoceutical products (cosmetic products infused with health benefits)
 80% of The Clorox Company’s sales are from domestic markets
 Currency impact was seen across many countries, driven by Venezuela and Argentina
and remains a relevant risk when contemplating future international expansion
opportunities
 Increasing international presence remains a core point of emphasis for the future of the
Company’s growth
% of 2014
Sales
CommentaryDivision
9

10. III. The Clorox Company Positioning

11.  The Clorox Co. is a leading manufacturer and marketer of
consumer and professional products.
 Produces primarily premium products in mid-sized
categories but have progressively been expanding into niche
markets
 Strong brands and high margins (>17% EBIT margins)
 Solid and stable cash flow
 Strong relationship with shareholders through payouts
(60+% payout ratio)
 Can accelerate profit growth with productivity gains
 In recent years, inorganic growth has been stimulated
through the purchase of professional medical healthcare
companies to strengthen product offerings and expand
industry expertise
• Acquired Caltech Industries in 2010, whose core product
was DISPATCH hospital disinfectant spray, for $23M to
enhance ability to create presence in this space
• Aplicare Inc. and Healthlink in 2012, combined purchase
price of $80-90M
• In 2011, Acquired Barrow Riddell & Associates Inc. –
provider of healthcare products as a bolt-on strategy
Company Positioning
Key Brands
OVERVIEW
Business Description
Acquisitions and Growth Sales Profile By Segment (FY 2014)
The majority (80%) of
Clorox’s Brands are
#1 or #2 in their
respective categories
Clorox’s weighted-average
category growth is pulled
downwards, at 4.2%, since most
sales are from Cleaning or
Household Products which are
inherently slower-growth
categories
In recent years, the
Lifestyle segment has
been the strongest
11

12. Equity Performance
$80.00
$82.00
$84.00
$86.00
$88.00
$90.00
$92.00
$94.00
$96.00
$98.00
$100.00
Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14
CLX Closing Share Prices (1 Year)
Rejection of 15x EV/EBITDA acquisition offer
announced
Clorox releases earnings report exceeding
expectations and continues the trend with
growth and rising dividends The Clorox Co. announces exit of
operations from Venezuela
3rd Quarter fiscal earnings call in May 2014 stated its
plan to introduce more value-sized packs and
products with value-added benefits Clorox stock
is currently
trading near
all-time highs
regardless of
flat growth
projections
12

13. Corporate Strategy
2020 Strategy
 Introduced in 2014, this strategic growth plan is intended
to direct the Company to the highest value opportunities
through the following measures:
 Annual net sales growth of 3-5%
 Market share growth
 Annual EBIT margin growth
 Product innovation
 Desire, Decide, and Delight
 More targeted message for consumers by reinforcing
value proposition of brand that:
 Drive consumer desire
 Compel purchase decisions
 Delight consumers
3-D Demand-Creation Model
Align With Four Consumer Megatrends
 Health and Wellness
 Sustainability
 Consumer Fragmentation
 Affordability and Value
Clorox’s long-term strategic goal is to deliver profitable growth and stockholder value by driving net sales growth and margin
improvement, continuing to slow the growth of selling and administrative expenses by driving out low-value activity, rebuilding
margin in its international businesses, and increasing its total brand-building investment over time.
OVERVIEW
Coordinate Operations With Strategy
 Focus on improving core product groups and
competencies
 Elimination of extraneous or underperforming divisions
 Low sales growth potential
 Use proceeds to invest in the Company, make a strategic
acquisition, or buyback shares
 Raise capital for better growth or investment
opportunities
 Boost shareholder value
13

14. IV. Strategic Options

15.  Less attractive overall in comparison to peers
 Clorox’s organic growth has lagged behind US peers for six quarters
straight
 Discontinuing operations in Venezuela where Clorox has been operating at a
loss but still anticipating flat sales moving forwards
 Rejected takeover from a rival with a premium of 20% which places it at 15x
EV/EBITDA – a high price for a company with limited growth
 Flat sales growth makes it a less attractive prospect
 Many potential strategics are currently streamlining operations
 The IRR required by PE firms is not attainable with Clorox unless it is
purchased at a discount of 30% to share price
 The smaller growth rate within its divisions decreases the amount of cash
flows necessary to pay down the debt required to LBO the company
Maintain the Status
Quo
Strategic Overview
Sell Clorox to A
Strategic
Take Clorox Private
(Sponsor)
Divest A Segment of
Clorox
 Ability to sell at a higher multiple
 Raise capital for better growth or investment opportunities
 Align product divisions with the strategic goals set by the Company
 Focus more resources on their core business or geographies
Growth is the most
important factor in
evaluating these options
as well as the ability to
focus resources on core
operations as is the
industry trend for
competitors
Growth requires
innovation and
capital to for
resources and
investment
opportunities
15

16. Strategic Proposal: Divestiture of Kingsford
The former Vice President of Investor Relations of Clorox said in the company’s earnings
call in August, “We delivered three percentage points of top-line growth from innovation
for the third consecutive fiscal year, consistent with our long-term strategic target.”
 Raise capital for future investment
opportunities and growth initiatives
 Streamline operations for increased
focus on core competencies
 Anticipate trends and align
operations to acquire full possible
value
 Coordinate operations with
managerial vision to accomplish
financial and strategic objectives
 the development of new products
and categories remains important to
growth in the consumer products
industry
Operational Rationale Strategic RationaleFinancial Rationale
 Potential for high multiple because
Kingsford has the highest market
share in the sector
 Anticipated increase of margins
due to lower input prices as a
result of the decreasing price of
oil
 High expected synergies with
the companies involved in the
targeted auction process
 Brand name value
 Anticipated Selling Multiple:
16.0x
 Anticipated Selling Price: $1.5
Billion
 Innovation keeps consumers from
defecting to less expensive private
label products that do not have the
same features and may benefit from
the consumer trend of trading up to
better products that cost more
 Increase value to company through
the following measures:
 Return proceeds to
shareholders
 Buyback shares
 Acquire company to continue
expansion of lifestyle segment
which has the highest
projected growth
16
We recommend The Clorox Company divest the Kingsford brand due to the rich multiple to raise capital to pursue additional
growth opportunities and to better align the Company with the four consumer megatrends.
Note: DCF Valuation of
Kingsford on page 32

17. 17
Recommended Acquirers of Kingsford
 Energy and manufacturing conglomerate based in Wichita, KA
 Manufactures a wide variety of products including: transportation fuels, building and
consumer products, electronic connectors, membrane filtration and more
 Although Koch is a private company, it has underwent a recent string of acquisitions
(PetroLogistics, Buckeye Technologies, Molex) and has demonstrated interest in
continuing the trend and turning the company into a privately held version of Berkshire
Hathaway
Koch will be able
to utilize the
acquisition of
Kingsford to
further penetrate
the consumer
space
 2013 EBITDA: $9,695.0M
 Leverage Ratio: 1.8x Debt/EBITDA
 Recent acquisitions of Duracell and and Heinz indicate a strong appetite for consumer
goods brands
 Historically has a strong preference for brands with a strong market share in shrinking
overall markets
Berkshire is
looking into
penetrating the
consumer space
further and
would benefit
from Kingsford’s
market
dominance
 BDT Capital acquired Weber for $65 million equity and $150 debt for a majority stake in
the company
 BDT has also advised on the Alberto Culver sale to Unilever (significant experience in
the consumer products industry)
 An attractive staple-on to the Weber acquisition
Weber will reap
the natural
synergies of the
of vertical
integration in the
niche charcoal
market

18. Infeasibility of Maintaining the Status Quo
Church & Dwight
 Only company in the laundry detergent business whose shares grew every year over the
last five years
 Purchased Avid Health Inc. in 2012 for $650 million to access a new growth platform in a
high growth segment ($15 million in synergies)
 Unit volume in domestic consume segment, at 4.2%, grew faster than all of its peers over
the last four quarters
P&G
 P&G has divested various brands in the past, and we expect it to continue pruning its brand
portfolio going forward P&G has divested over 26 businesses since its merger with Gillette in
2005, including: its pharmaceutical business to Warner Chilcott for $2.9 billion in 2009, and
its Pringles snack foods business to Kellogg Co. for $2.7 billion in May 2012, which marked
P&G’s exit from the food business
Kimberly-Clark
 Announced that it was pursuing a spin-off of its healthcare business
 A divestiture would allow the company to improve focus on its other core businesses,
primarily on its personal care, consumer tissue, and professional brands. In May 2014, the
company revealed its decision to form a new healthcare division, Halyard Health, Inc. The
transaction will enable Kimberly-Clark to focus on its core operations and bolster its market
position.
Competitors are all
taking measures to
improve growth
profile and
streamline
operations by
divesting non core
business segments
Energizer Holdings, Inc.
 Energizer Holdings, Inc. announced that it would split its divisions into two separate
companies
 Household Products can use its leading brands and product portfolio to generate
cash flows
 Personal Care business has achieved scale to be able to focus on continuing
innovation, to drive top-line and market share growth, enabling the company to
have greater brand focus in specific markets
18
Church & Dwight
is differentiating
itself by achieving
growth through
acquisitions

19. Divergence of Clorox from the Ideal Strategic Target
Revenue Synergies Cost Synergies
Enhanced Growth Initiatives
Consolidation of overlapping facilities and headcount
reduction
Ability to sell products through distribution channels without
cannibalizing the original product base
Ability to buy key inputs at lower prices due to increased
purchasing power
Ability to Leverage target’s technology, geographic presence,
or know-how to enhance or expand its existing product or
service offering
Seek to acquire a target that sells through the professional or
contractor channel so as to expand its paths to market
Increased size enhances a company’s ability to leverage its fixed
cost base across existing and new products
Better Terms from suppliers due to larger volume orders -
“purchasing synergies”
Value Creation
19
Buyer MotivationThe Clorox Company is experiencing flat
sales growth and has already implemented
effective cost minimizing measures so the
prospect of revenue and cost synergies are
reduced
Diverse product base and sheer size make
The Clorox Company a difficult acquisition
target in terms of integration and purchase
price

20. Strategic Buyers
 Consumer Products Company focused on food and healthcare
 30% + Market Share in margarine
 14 Brands over $1 Billion – Axe, Dove, Lipton, etc.
 Divesting itself of food under current management
 A Consumer Products company, maintains segments as diverse as food
and outdoor goods.
 Focus on four segments: Outdoor Solutions, Branded Consumables,
Consumer solutions, and Adio Footwear
 Largest Consumer Products company in the world
 26 Brands over $1 Billion – Bounty, Tide, Crest, etc.
 Currently divesting itself of 100 of its 180 brands to refocus on revenue
generating lines
 Household goods company specializing in cleaners and personal care
 26 Brands over $1 Billion – Bounty, Tide, Crest, etc.
 Currently divesting itself of 100 of its 180 brands to refocus on revenue
generating lines
20
Share Price: $45.76
LTM Revenue: $8,065
Enterprise Value: $13,193
Share Price: $89.55
LTM Revenue: $82,649
Enterprise Value: $268,439
Share Price: $71.22
LTM Revenue: $3,218
Enterprise Value: $10,360
Share Price: $3,233.75
LTM Revenue: $61,481
Enterprise Value: $127,124

21. Overview of the LBO Market
The Zephyr Group recommends against an LBO of Clorox in the
event of a sell-side transaction taking place since management is
not likely to receive a favorable multiple:
 Private equity firms have been shying away from leveraged
buyouts of large public companies in recent years
 Purchase price multiples have been rising recently but have
not come close to the 15.0x offer Clorox received earlier this
year
 Leveraging Clorox to 7.0x Debt/EBITDA still requires a 50%
equity contribution which is greater than the already inflated
average of 40%
Industry trends reduce LBO feasibility
21

22. Financial Sponsors
 They strive to create value by investing in great businesses where their capital, strategic insight, global
relationships and operational support can drive transformation and realize the company’s potential.
 The resulting improvements in growth and global competitiveness benefit not only investors, but also
workers, communities and all stakeholders.
 Contains strong relationships with potential strategic partners.
 Well positioned to invest with families and founders who built businesses and seeking partial liquidity /
transition to new ownership and management to allow for accelerated growth.
 Several unique resources: Global presence, footprint, tight sector focus, expertise, strategic advice to
accelerate growth
 partnership approach - allow management team to operate business as significant shareholders
 The Carlyle Group is a global asset manager with more than $203 billion in assets under management
 Operating in 40 offices in North America, South America, Europe, the Middle East, North Africa, Sub-
Saharan Africa, Japan, Asia and Australia.
 Through an array of products and geographic specific-funds, we work to meet the dynamic needs of the
world’s most sophisticated investors.
 Expertise and deep industry knowledge - Invest in sectors we know, and value depth over breadth
 Opportunity to utilize expertise across multiple geographical regions. partnering with management to
grow the company.
 Currently growing both organically and through acquisitions
 Can utilize the seasoned M&A team.
 In-house operations will be able to help create a more efficient process in the United States. Good amount
of industry experts that will be able to help management increase effectiveness and restructure their team.
22

23. V. Financial Analysis

24. The Clorox Company – Valuation Summary
Implied EV/EBITDA of 14.0x-15.0x
Implied EV/EBITDA of 13.5x-14.5x
Implied EV/EBITDA of 11.6.0x-13.3x
Implied EV/EBITDA of 12.5x-14.8x
Implied EV/EBITDA of 12.0x-13.5x
Implied EV/EBITDA of 11.0x-12.6x
$15,253
($93.65)
$13,337
($85.36)
$15,253
($99.73)
$15,471
($101.41)
$16,961
($112.61)
$16,617
($110.02)
$17,190
($114.33)
$16,044
($105.71)
$14,554
($94.51)
$14,325
($92.79)
$13,752
($88.48)
$12,606
($79.86)
Recommended Valuation
EV/EBITDA: 14.5x
Enterprise Value: $16,617
24

25. The Clorox Company - Discounted Cash Flow Analysis
2012A 2013A 2014A 2015E 2016E 2017E 2018E 2019E
Sales $5,468.0 $5,263.0 $5,591.0 $5,561.0 $5,727.0 $5,898.0 $6,074.9 $6,257.1
% Growth N/A (3.7%) 5.9% (0.5%) 3.0% 3.0% 3.0% 3.0%
Cost of Sales 3001.0 3038.0 3231.0 3180.0 3262.0 3361.8 3462.7 3566.6
% of Sales 54.9% 57.7% 57.8% 57.2% 57.0% 57.0% 57.0% 57.0%
Gross Profit $2,467.0 $2,225.0 $2,360.0 $2,381.0 $2,465.0 $2,536.1 $2,612.2 $2,690.6
SG&A 1401.0 1437.0 1394.0 1402.0 1432.0 1474.7 1519.0 1564.6
% of Sales 25.6% 27.3% 24.9% 25.2% 25.0% 25.0% 25.0% 25.0%
EBITDA $1,244.0 $970.0 $1,146.0 $0.0 $1,157.0 $1,216.0 $1,256.0 $1,293.7 $1,332.5
% Margin 19.5% 15.0% 17.3% 17.6% 18.0% 18.0% 18.0% 18.0%
Depreciation & Amortization 178.0 182.0 180.0 178.0 183.0 194.6 200.5 206.5
EBIT $1,066.0 $788.0 $966.0 $979.0 $1,033.0 $1,061.4 $1,093.2 $1,126.0
Taxes/(Benefit) 35.0% 248.0 279.0 299.0 342.7 361.6 371.5 382.6 394.1
EBIAT $818.0 $509.0 $667.0 $0.0 $636.4 $671.5 $689.9 $710.6 $731.9
Plus: Depreciation & Amortization 178.0 182.0 180.0 178.0 183.0 194.6 200.5 206.5
Less: Capex 192.0 194.0 138.0 166.8 171.8 176.9 182.2 187.7
% of Sales 3.5% 3.7% 2.5% 3.0% 3.0% 3.0% 3.0% 3.0%
Less: Increase/(Decrease) in NWC 20.6 -1.5 -28.4 -3.9 -4.0
Unlevered Free Cash Flow $626.9 $684.1 $736.0 $732.7 $754.7
WACC 6.0% 6.0% 6.0% 6.0% 6.0%
Discount Period 0.5 1.5 2.5 3.5 4.5
Discount Factor 0.97 0.92 0.86 0.81 0.77
Present Value of Free Cash Flows $608.8 $626.6 $635.8 $597.0 $580.0
Historical Period Projection Period Enterprise Value
Present Value of FCF $3,048.2
Terminal Value
Terminal Year EBITDA 1,126.0
Exit Multiple 14.0x
Terminal Value 15,764.2
Discount Factor 0.77
Present Value of Terminal Value 12,114.4
% of Enterprise Value 79.9%
Enterprise Value $15,162.6
Implied EV / EBITDA
Enterprise Value 15,162.6
2014A EBITDA 1,146.0
Implied EV / EBITDA 13.2x
The calculation of the implied share price of The Clorox
Company illustrates that it is currently trading at a
price reflecting its intrinsic value.
Implied Equity Value and Share Price
Enterprise Value $15,162.6
Less: Total Debt 2,313.0
Less: Preferred Stock 0.0
Less: Noncontrolling Interest 0.0
Plus: Cash and Cash Equivalents 329.0
Implied Equity Value 13,178.6
Fully Diluted Shares Outstanding 133.000
Implied Share Price $99.09
Implied Perpetuity Growth Rate
Terminal Year Free Cash Flow 754.7
WACC 6.0%
Terminal Value 15,764.2
Implied Perpetuity Growth Rate 1.0%
25

26. The Clorox Company - Comparable Companies Analysis
Tier 1 peers represent
the comprehensive
consumer products
companies who compete
directly with The
Clorox Company for
shelf space and
consumer loyalty
Tier 2 peers are large
blue-chip companies
that share slots in the
major indices with The
Clorox Company
Share % of 52wk Equity Enterprise
Price High Value Value 2015E 2016E 2015E 2016E 2015E 2016E
Clorox $99.47 99.7% $13,256 $15,240 13.5x 12.6x 22.5x 21.2x 3.5x 3.3x
P/E PEGEV/EBITDA
Tier 1 Peers
Procter & Gamble $85.16 99.1% $245,942 $269,439 14.2x 12.9x 19.4x 17.9x 2.3x 2.1x
Unilever $38.69 87.6% $112,640 $127,400 12.4x 13.5x 23.0x 21.4x 2.9x 2.7x
Colgate-Palmolive $65.35 93.2% $60,508 $65,518 14.7x 12.8x 21.5x 19.7x 2.5x 2.3x
Reckitt Benckiser $80.10 89.9% $58,567 $62,069 14.4x 13.7x 18.9x 18.2x
Kimblerly-Clark $113.10 98.8% $42,514 $48,015 11.5x 10.6x 18.6x 17.7x 2.8x 2.6x
Church & Dwight $71.22 99.9% $9,779 $10,360 14.8x 12.7x 22.4x 20.3x 2.2x 2.0x
Energizer $120.60 95.9% $7,525 $8,778 11.0x 9.6x 16.3x 15.3x 2.6x 2.4x
Mean 94.9% 13.3x 12.3x 20.0x 18.6x 2.5x 2.4x
Median 95.9% 14.2x 12.8x 19.4x 18.2x 2.5x 2.3x
High 99.9% 14.8x 13.7x 23.0x 21.4x 2.9x 2.7x
Low 87.6% 11.0x 9.6x 16.3x 15.3x 2.2x 2.0x
Tier 2 Peers
Coca-Cola $41.03 91.4% $182,378 $190,132 14.4x 14.0x 19.8x 18.9x 5.5x 5.3x
Pepsico $94.60 98.3% $144,265 $162,134 9.7x 11.7x 19.9x 18.5x 2.5x 2.3x
Kraft $56.83 93.0% $34,098 $42,736 9.2x 10.6x 17.3x 16.1x 2.1x 2.0x
General Mills $51.03 91.7% $32,103 $40,555 12.1x 10.8x 17.0x 15.9x 2.5x 2.3x
Estee Lauder $74.35 95.7% $29,004 $28,732 13.0x 11.7x 24.9x 20.8x 2.7x 2.2x
Kellogg $61.94 89.1% $22,422 $29,687 8.4x 10.6x 15.5x 14.8x 2.7x 2.6x
Hershey $94.13 86.6% $21,177 $22,574 14.3x 11.9x 22.1x 20.1x 2.2x 2.0x
Campbell Soup $43.17 92.5% $13,642 $17,413 11.2x 10.8x 17.4x 16.6x 4.7x 4.5x
Molson Coors $73.23 94.2% $13,613 $14,284 17.1x 9.5x 17.0x 16.5x 3.0x 2.9x
Avon $11.48 50.2% $4,989 $6,830 14.9x 6.8x 13.3x 11.6x 3.4x 3.0x
Mean 88.3% 12.4x 10.8x 18.4x 17.0x 3.1x 2.9x
Median 92.1% 12.5x 10.8x 17.4x 16.6x 2.7x 2.5x
High 98.3% 17.1x 14.0x 24.9x 20.8x 5.5x 5.3x
Low 50.2% 8.4x 6.8x 13.3x 11.6x 2.1x 2.0x
26

27. The Clorox Company - Precedent Transactions Analysis
Enterprise Enterprise Value/
Date Acquirer Target Value LTM Sales LTM EBITDA
Strategic Acquisitions
Aug-14 Walgreens Co Alliance Boots GmgH $14,417 0.7x 13.4x
Jan-14 Saraya Co Goodmaid Chemicals Corp $133
Nov-12 Svenska Cellulosa AB SCA Hygiene Products $1,477 1.1x 8.5x
Feb-12 Marico Foods Ltd Paras Pharmaceuticals LTD $150
Jun-11 Sealed Air Corp Diversey Holdings Inc $4,278 1.4x 11.5x
May-11 Unilever Plc Alberto-Culver LLC $3,761 2.4x 14.7x
Aug-10 Reynolds Group Holdings Ltd Pactiv Corp $5,649 1.6x 7.9x
Mean $4,266 1.4x 11.2x
Median $3,761 1.4x 11.5x
High $14,417 2.4x 14.7x
Low $133 0.7x 7.9x
Financial Sponsors
Nov-14 Berkshire Hathaway Inc Duracell International Inc $3,000 1.5x 7.0x
May-14 IMM Private Equity Inc Bioland Ltd $78 4.0x 15.1x
Apr-13 Invest AG Lenzing Plastics $117 0.8x
Feb-13 Berkshire Hathaway Inc HJ Heinz Co $28,686 2.4x 13.6x
Mean $7,970 2.2x 11.9x
Median $1,559 2.0x 13.6x
High $28,686 4.0x 15.1x
Low $78 0.8x 7.0x
27

28. The Clorox Company - Sum of Parts Analysis
Product Division EBITDA EV/EBITDA Division Valuation
Glad Global $231.0 12.6x $2,907.1
Food Global $198.0 10.0x $1,972.9
Burt's Bees $38.0 12.6x $478.4
Brita Global $97.0 12.5x $1,214.6
Miscellaneous $598.0 13.3x $7,937.4
Enterprise Value $14,510.37
20%
14%
3%
8%
55%
Glad Global
Food Global
Burt's Bees
Brita Global
Miscellaneous
Analysis of significance
Weight of Division Valuation
Based on average EV/EBITDA
segment multiples, the combined
enterprise value of The Clorox
Company is $14,510.37
28

29. The Clorox Company - Comparable Segments Analysis
Share Equity Enterprise P/E PEG LTM
Price Value Value 2014A 2015E 2014A 2015E 2015E 2016E Revenue
Clorox $99.47 $13,256 $15,240 13.5x 22.5x 21.2x 3.5x 3.3x $5,591
EV/EBITDA
Glad Global
Proctor & Gamble $89.55 $245,942 $269,439 12.8x 13.7x 20.0x 20.7x 6.3x 3.7x $82,649
MeadWestvaco $43.59 $7,451 $9,087 9.4x 8.5x 7.9x 20.3x 0.6x 0.9x $5,434
Bemis Company $42.92 $4,348 $5,673 9.5x 9.4x 18.8x 17.4x 12.4x 4.0x $4,510
Sealed Air $40.92 $8,854 $13,049 11.7x 11.2x 24.1x 20.6x 0.8x 1.2x $7,789
Mean 10.9x 10.7x 17.7x 19.8x 5.0x 2.5x $25,096
Median 10.6x 10.3x 19.4x 20.5x 3.6x 2.5x $6,612
High 12.8x 13.7x 24.1x 20.7x 12.4x 4.0x $82,649
Low 9.4x 8.5x 7.9x 17.4x 0.6x 0.9x $4,510
29

30. The Clorox Company – Comparable Segments Analysis
Share Equity Enterprise P/E PEG LTM
Price Value Value 2014A 2015E 2014A 2015E 2015E 2016E Revenue
Clorox $99.47 $13,256 $15,240 13.5x 22.5x 21.2x 3.5x 3.3x $5,591
EV/EBITDA
Brita Global
Pentair $60.02 $11,211 $14,025 11.0x 10.2x 16.0x 13.7x 1.1x 1.1x $7,548
Jarden $45.76 $8,803 $13,193 11.7x 10.8x 17.4x 15.5x 2.0x 1.7x $8,065
Procter & Gamble $89.55 $245,942 $269,439 12.8x 13.7x 20.0x 20.7x 6.3x 3.7x $82,649
Tupperware $63.16 $3,181 $4,023 8.9x 8.7x 12.1x 11.7x - - $2,643
3M $157.12 $100,685 $105,217 12.3x 11.8x 21.0x 19.2x 2.1x 2.2x $31,671
Newell Rubbermaid $34.58 $9,375 $11,426 12.1x 11.1x 17.3x 15.7x 2.1x 2.0x $5,691
Mean 11.5x 11.1x 17.3x 16.1x 2.7x 2.1x $23,045
Median 11.9x 11.0x 17.4x 15.6x 2.1x 2.0x $7,807
High 12.8x 13.7x 21.0x 20.7x 6.3x 3.7x $82,649
Low 8.9x 8.7x 12.1x 11.7x 1.1x 1.1x $2,643
Food Global
Lancaster Colony $91.90 $2,513 $2,285 13.7x 13.1x 25.0x 24.3x 9.7x 4.7x $1,015
McCormick $72.48 $9,398 $10,680 14.7x 13.9x 21.6x 20.2x 3.2x 3.2x $4,240
Campbell's Soup $43.75 $13,709 $15,714 11.3x 10.1x 16.2x 17.8x - 13.9x $8,358
Treehouse $82.45 $3,490 $5,021 13.2x 10.7x 22.5x 19.7x 1.7x 1.8x $2,703
Unilever $3,233.75 $114,811 $127,124 11.8x 11.3x 19.9x 18.5x - 9.2x $61,481
Kraft $59.22 $34,870 $43,954 12.0x 11.3x 18.9x 17.6x 1.1x 1.7x $18,104
Smucker's $99.16 $10,096 $12,399 10.5x 10.0x 17.9x 16.7x - 6.5x $5,505
Mean 12.5x 11.2x 19.9x 18.9x 3.6x 5.4x $14,932
Median 12.0x 11.0x 19.4x 18.2x 2.1x 4.0x $6,932
High 14.7x 13.9x 25.0x 24.3x 9.7x 13.9x $61,481
Low 10.5x 9.2x 16.2x 16.1x 1.1x 1.7x $1,015
30

31. The Clorox Company - Leveraged Buyout Analysis
Free Cash Flow 2015 2016 2017 2018 2019
EBITDA $1,157 $1,216 $1,256 $1,294 $1,332
Less: CapEx (167) (172) (177) (182) (188)
Less: Increase in NWC 21 (1) (28) (4) (4)
Less: Cash Interest (561) (535) (508) (478) (443)
Less: Cash Taxes (146) (174) (194) (215) (239)
FCF for Debt Repayment 304 333 349 414 459
Sources Multiple % Total
Senior Debt 4,584 4.0x 29.7%
Sub Debt 2,292 2.0x 14.8%
Mezzanine 0 0.0x 0.0%
Sponsor Equity 8,566 7.5x 55.5%
Total $15,442 13.47x 100.0%
Uses
Purchase Equity $13,230
Refinance Net Debt 1,984
Transaction Fees 228
Total $15,442
Purchase Price Calculation
Basic Shares 128.6
Current PPS $99.47
Offer Premium 0.0%
Offer PPS $99.47
FD Shares 133.0
Equity Offer Price $13,230
Tax Rate 35.0%
Assumptions
Base Year 2014
Sponsor Target IRR 20.0%
Exit Mulitple 13.0x
Tax Rate 35.0%
Circular On? Yes
Revolver - 5.0%
Senior Debt 4.0x 8.0%
Sub Debt 2.0x 9.0%
Mezzanine 0.0x 10.0%
Returns Analysis
Terminal EBITDA $1,332 Terminal EBITDA $1,332
Exit Multiple 13.0x Exit Multiple 13.0x
Enterprise Value $17,322 Enterprise Value $17,322
Less: Net Debt (5,017) Less: Net Debt (5,017)
Equity Value at Exit $12,306 Equity Value $12,306
Sponsor Ownership at Exit 95.0% Sponsor Ownership at Exit 95.0%
Sponsor Equity Value at Exit $11,690 Sponsor Equity Value at Exit $11,690
Sponsor Equity Value at Closing 8,566 Sponsor Required IRR 20.0%
IRR % 6.4% Sponsor Equity at Closing 4,698
Net Debt at Closing 6,876
Implied TEV at Closing 11,574
Less: Old Net Debt (1,984)
Less: Transaction Fees (228)
Equity Purchase Price 9,362
FD Shares 133.0
Implied Offer PPS $70.39
Implied Offer Premium (29.2%)
The implied
IRR of 6.4% is
too low and
required
equity
contribution
of 57% is too
high to attract
financial
sponsors. The
return they
seek (typically
20% at least)
would require
a discount of
approximately
29%
31

32. Charcoal Division – Discounted Cash Flow Analysis
Projection Period
2014A 2015E 2016E 2017E 2018E 2019E
Revenue $559.1 $556.1 $572.7 $589.8 $607.5 $625.7
% Growth N/A (0.5%) 3.0% 3.0% 3.0% 3.0%
Cost of Sales 323.1 318.0 326.2 336.2 346.3 356.7
% of Sales 57.8% 57.2% 57.0% 57.0% 57.0% 57.0%
Gross Profit $236.0 $238.1 $246.5 $253.6 $261.2 $269.1
SG&A 139.4 140.2 143.2 147.5 151.9 156.5
% of Revenue 24.9% 25.2% 25.0% 25.0% 25.0% 25.0%
EBITDA $96.6 $97.9 $103.3 $106.1 $109.3 $112.6
% Margin 17.3% 17.6% 18.0% 18.0% 18.0% 18.0%
Depreciation & Amortization 18.0 17.8 18.3 19.5 20.0 20.6
EBIT $78.6 $80.1 $85.0 $86.7 $89.3 $92.0
Taxes/(Benefit) 35.0% 29.9 28.0 29.8 30.3 31.2 32.2
EBIAT $48.7 $52.1 $55.3 $56.3 $58.0 $59.8
Plus: Depreciation & Amortization 18.0 17.8 18.3 19.5 20.0 20.6
Less: Capex 13.8 16.7 17.2 17.7 18.2 18.8
Less: Increase/(Decrease) in NWC 2.1 (0.1) (2.8) (0.4) (0.4)
Unlevered Free Cash Flow $51.1 $56.5 $60.9 $60.2 $62.0
WACC 6.0% 6.0% 6.0% 6.0% 6.0%
Discount Period 0.5 1.5 2.5 3.5 4.5
Discount Factor 0.97 0.92 0.86 0.81 0.77
Present Value of Free Cash Flows $49.6 $51.8 $52.7 $49.1 $47.7
Enterprise Value
Present Value of FCF $250.8
Terminal Value
Terminal Year EBITDA 92.0
Exit Multiple 14.0x
Terminal Value 1,287.3
Discount Factor 0.77
Present Value of Terminal Value 989.3
% of Enterprise Value 79.8%
Enterprise Value $1,240.1
Implied Equity Value and Share Price
Terminal Year Free Cash Flow 62.0
WACC 6.0%
Terminal Value 1,287.3
Implied Perpetuity Growth Rate 1.0%
Implied EV / EBITDA
Enterprise Value 1,240.1
2014A EBITDA 96.6
Implied EV / EBITDA 12.8x
We believe, although the exit multiple of comparable companies
is approximately 14.0x, Kingsford can be sold for 16.0x due to
its market domination, a control premium, and brand name.
32

33. VI. Execution

34. Execution Timeline
Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015
 Prepare marketing
materials and
confidentiality
agreement for
selected strategic and
financial buyers to
begin targeted
auction process of
Kingsford
Strategic Buyers:
 Western Refinery
 CVR Energy
 Koch Industries
Unilever
 P&G
 Jarden
 Church & Dwight
Financial Sponsors:
 The Blackstone
Group
 The Gores Group
 The Carlyle Group
 AEA
 Contact prospective
buyers
 Negotiate and
execute
confidentiality
agreements with
interested buyers
 Distribute
confidential
information
memorandum and
initial bid procedures
 Prepare management
presentation
 Set up data room
 Receive initial bids
and select buyers to
proceed to second
round
 Obtain necessary
regulatory approval
 Finance and close
deal
 Conduct
management
presentations with
second round bidders
 Set up visits to
company
headquarters in
Oakland, CA
 Provide data room
access to bidders
 Distribute final bid
procedures letter and
draft definitive
agreement
 Receive final bids
 Evaluate final bids
 Negotiate deal terms
with preferred buyers
 Select winning bidder
 Receive board
approval and execute
definitive agreement
34

35. Execution Risks & Mitigation Strategies
35
Low Multiples
Loss of
Confidentiality
Loss of
Revenue
Risk
 Kingsford demands a lower than anticipated multiple, limiting unlocked liquidity
Mitigation
 Identify strategic buyers with high synergies for targeted sale – allowing Clorox to hold on to
the division if our prices are not met
 In the absence of buyers, Clorox keeps Kingsford and can begin seeking innovative growth
initiatives (i.e. green charcoal)
Risk
 Post-sale, Kingsford could conceivably be driven higher based on production and input
savings
Mitigation
 Lower inputs will benefit Clorox across the board
 Incremental growth in Kingsford will be less than growth opportunities in growing sectors
such as personal care
 Clorox realizes the gains on a strong brand now and has the opportunity to build another
Risk
 During the targeted sale, competitors gain access to proprietary information and strategies
Mitigation
 We take the utmost precautions to protect the confidential information of our clients
 Our strong network of industry contacts helps us screen candidates
 Sale of the Kingsford line compartmentalizes information released and protects the core
intellectual property of Clorox

36. VII. Appendix

37. 37
Acquisition Possibilities – Betting on Global Personal Care
Acquisition Target: Shiseido
Asian Consumer Discretionary Trends Global Cosmetics and Cosmeceuticals
 Strategic Rationale:
 Acquisition of Shiseido would bolt on 3.3% of the world’s
cosmetics market share
 Provides CLX with the platform to bring its products into Asia,
starting with Burt’s Bees and with potential expansion of other
products
 Shiseido is looking to bring its products into America and CLX
provides the platform for them to do so
 Company Overview:
 Has been Japan’s largest cosmetics manufacturer since 1956, with
2014 sales of $8.3 billion
 Commands the loyalty of Chinese women, providing future cross
selling opportunities
 Markets its products worldwide in 89 countries under various
brand names such as Shiseido, White Lucent, BareMinerals, Nars
and Za
 Overseas sales accounted for 47.5% of 2014 revenue as a result of
globalization initiatives
 Despite being a mature industry, competition remains high among
nimble brands searching for trends
 A growing emphasis on sustainability and natural ingredients drives
sourcing
 Product innovation remains a key driver of growth within the industry
 Price of inputs, including oil expected to fall
 Consumer discretionary spending is expected to double from 4,000
per capita to 8,000 by the end of this decade
 Within this trend, households purchasing premium branded products
will increase by a 26% CAGR
 Middle class Chinese consumers show a clear preference for
international brands

38. The Clorox Company Acquisition of Shiseido
Post – Acquisition World Penetration
38
Current
Prospective

39. DCF and LBO Analysis Sensitivity Analyses
1.0% 13 13.5 14 14.5 15
5.0% -0.3% -0.1% 0.1% 0.3% 0.4%
5.5% 0.2% 0.4% 0.6% 0.7% 0.9%
6.0% 0.7% 0.9% 1.0% 1.2% 1.4%
6.5% 1.1% 1.3% 1.5% 1.7% 1.8%
7.0% 1.6% 1.8% 2.0% 2.1% 2.3%
Implied Perpetuity Growth Rate
Exit Multiple
79.9% 13.0x 13.5x 14.0x 14.5x 15.0x
5.0% 79.0% 79.6% 80.2% 80.8% 81.3%
5.5% 79.2% 79.8% 80.4% 80.9% 81.4%
6.0% 78.7% 79.3% 79.9% 80.5% 81.0%
6.5% 78.5% 79.1% 79.7% 80.3% 80.8%
7.0% 78.2% 78.8% 79.4% 80.0% 80.5%
PV of Terminal Value % of Enterprise Value
Exit Multiple
1323.1% 13.0x 13.5x 14.0x 14.5x 15.0x
5.0% 13.0x 13.4x 13.8x 14.2x 14.6x
5.5% 12.7x 13.1x 13.5x 13.9x 14.3x
6.0% 12.5x 12.9x 13.2x 13.6x 14.0x
6.5% 12.3x 12.6x 13.0x 13.4x 13.7x
7.0% 12.0x 12.4x 12.7x 13.1x 13.5x
Implied EV/EBITDA
Exit Multiple
1516258.5% 13.0x 13.5x 14.0x 14.5x 15.0x
5.0% 14,875$ 15,327$ 15,779$ 16,231$ 16,683$
5.5% 14,590$ 15,033$ 15,475$ 15,917$ 16,360$
6.0% 14,297$ 14,730$ 15,163$ 15,595$ 16,028$
6.5% 14,041$ 14,465$ 14,889$ 15,313$ 15,737$
7.0% 13,776$ 14,192$ 14,607$ 15,022$ 15,437$
Enterprise Value
Exit Multiple
1317858.5% 13.0x 13.5x 14.0x 14.5x 15.0x
5.0% $12,891 $13,343 $13,795 $14,247 $14,699
5.5% $12,606 $13,049 $13,491 $13,933 $14,376
6.0% $12,313 $12,746 $13,179 $13,611 $14,044
6.5% $12,057 $12,481 $12,905 $13,329 $13,753
7.0% $11,792 $12,208 $12,623 $13,038 $13,453
Implied Equity Value
Exit Multiple
WACCWACC
WACCWACC
WACC
Implied Offer Price Per Share
Exit Multiple
12.0x 12.5x 13.0x 13.5x 14.0x
12.0% $82.13 $84.83 $87.53 $90.23 $92.93
9.5% 86.73 89.75 92.77 95.80 98.82
7.0% 92.00 95.39 98.78 102.18 105.57
4.5% 98.06 101.88 105.70 109.52 113.33
2.0% 105.06 109.37 113.68 117.99 122.30
IRR
39

40. Discounted Cash Flow Analysis – WACC Calculations
WACC Calculation
Target Capital Structure
Debt-to-Total Capitalization 14.9%
Equity-to-Total Capitalization 85.1%
Cost-of-Debt
Pre-tax Cost of Debt 4.3%
Tax Rate 35.0%
After-tax Cost of Debt 2.8%
Cost of Equity
Risk-free Rate 2.1%
Market Risk Premium 7.3%
Levered Beta 0.62
Size Premium 0.0%
Cost of Equity 6.6%
WACC 6.0%
Total Debt 2,313.0
Shareholders' Equity 13,229.5
Debt/Capitalization 14.9%
Debt Calculation
% of Total Size Rate
26.5% 575 5.0%
13.8% 300 3.6%
18.4% 399 6.0%
13.7% 298 3.8%
27.6% 598 3.1%
Weighted Average
Cost of Debt
4.3%
40

41. Discounted Cash Flow Analysis – Net Working Capital Calculations
Historical Period Projection Period
2013A 2014A 2015E 2016E 2017E 2018E 2019E
Revenue $5,263.0 $5,591.0 $5,561.0 $5,727.0 $5,898.0 $6,074.9 $6,257.1
COGS 3,001.0 3,231.0 3,180.0 3,262.0 3,361.8 3,462.7 3,566.6
Current Assets
Accounts Receivable 580.0 546.0 543.0 559.0 589.8 607.5 625.7
Inventory 394.0 386.0 380.0 390.0 412.9 425.2 438.0
Other Current Assets 109.7 109.2 108.7 111.9 115.2 118.7 122.3
Accounts Receivable Days Outstanding 40.2 35.6 35.6 35.6 36.5 36.5 36.5
Inventory Turns 7.6 8.4 8.4 8.4 8.1 8.1 8.1
Inventory Days Outstanding 47.9 43.6 43.6 43.6 44.8 44.8 44.8
Other Current Assets % of Revenue 2.1% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0%
Current Liabilities
Accounts Payable 413.0 440.0 433.8 446.7 460.0 473.8 488.1
Income Tax Liabilities 29.0 8.0 27.8 28.6 29.5 30.4 31.3
Other Current Liabilities 490.0 472.0 469.5 483.5 497.9 512.9 528.2
Days Payables Outstanding 50.2 49.7 49.8 50.0 49.9 49.9 49.9
Income Tax Liabilities as % of Revenue 0.6% 0.1% 0.5% 0.5% 0.5% 0.5% 0.5%
Other Current Liabilities % of Revenue 9.3% 8.4% 8.4% 8.4% 8.4% 8.4% 8.4%
Net Working Capital 151.8 121.3 100.7 102.2 130.5 134.5 138.5
(Increase)/Decrease in Net Working Capital n/a $30.5 $20.6 ($1.5) ($28.4) ($3.9) ($4.0)
41