Clorox divesting operations in Argentina, Uruguay and Paraguay

Clorox announced the sale of certain wholly owned subsidiaries – Clorox Argentina -, with operations in Argentina, Uruguay and Paraguay, to Apex Capital, a private equity fund associated with Grupo Mariposa, a 139-year old food and beverage company with operations in 16 countries, and an investment group led by Diego Barral, former SVP and general manager of International at Clorox. Financial terms were not disclosed. The transaction included Clorox Argentina’s two production plants, as well as rights to certain Clorox brands in Argentina, Uruguay and Paraguay and shared intellectual property across those brands. The transaction does not include Clorox’s Latin America R&D and corporate hubs, which will remain in Argentina. Clorox Argentina’s employees, including all production staff, will remain employed by Clorox Argentina, to be renamed and operate under the name of Grupo Ayudin, except for employees dedicated to the R&D and corporate hubs, who will remain with Clorox under a new corporate structure in Argentina. Clorox Argentina represents approximately 2% of the company’s FY24 net sales outlook. As a result of this transaction, the company will incur a one-time, after-tax charge of approximately $233M in 3Q24, or approximately a $1.87 reduction to EPS. The vast majority of this charge is driven by the non-cash release of approximately $222M of accumulated currency translation previously recorded in equity. This transaction is expected to reduce the company’s FY24 net sales growth by approximately half a point and adjusted EPS by 0c-2c. The company is not otherwise reiterating any prior guidance.