Thursday said it will buy back Henkel's 29% stake in the cleaning products company.
Under terms of the $2.8 billion transaction, Germany-based Henkel will acquire Clorox's 20% stake in Henkel Iberica, a joint venture between the two companies in Spain and Portugal.
The deal, which is essentially an asset swap, also calls for Henkel to buy Clorox's interest in pesticide businesses.
Henkel last December inked a deal to acquire U.S. soapmaker
for about $2.9 billion.
The Henkel stake represents approximately 61.4 million shares of Clorox common stock.
Clorox said the transaction will add 7 cents to 10 cents a share to earnings in fiscal 2005 and is expected to close no later than Dec. 1.
Clorox shares ended at $54.31 Wednesday, less than a dollar off their 52-week high.