Project Aardvark

Presentation to the Board of Directors

January 29, 2010
 Table Of Contents
Executive Summary
3
Aardvark Valuation
5
Potential Acquisitions
11
Process Recommendations
16
Appendix
19
Executive Summary
 Executive Summary
• As of January 29, 2010, Aardvark’s share price and valuation are at all-time highs,
having more than doubled since early 2009
• As Aardvark’s stock price has soared in value, it has also generated over $35B in
cash & cash-equivalents
• As Aardvark’s cash balance grows, it is likely to face shareholder pressure to re-
invest the cash in its business and to make significant acquisitions
• Given Aardvark’s strong currency and cash balance, it could easily make several
“tuck-in” acquisitions – or larger-scale acquisitions to acquire customers
• Such a strategy would allow Aardvark to capture more of the smartphone, laptop,
and desktop markets, and significantly improve its software offerings
• Given Aardvark’s cash position, such acquisitions could be made with 100% cash –
or in the case of a larger deal, stock could also be used
Aardvark Valuation
 Valuation Summary
• Aardvark’s current share price of $192.61 far exceeds the value implied by
comparable public companies
• Recent comparable transactions show higher implied valuation ranges due to
flurry of consolidation and hardware M&A activity over 2009
• Discounted Cash Flow Analysis under base-case assumptions shows implied
valuation on-par with Aardvark’s current share price, implying that share price is
justified
• All valuation analysis is based on “base-case” financial projections in line with Wall
Street analyst expectations
• Given Aardvark’s cash balance and high valuation multiples vs. similar public
companies, few competitors are well-positioned to make substantial acquisitions
Aardvark Valuation
Summary
Aardvark Valuation
Summary
Aardvark Comparable Public
Companies
Aardvark Precedent
Transactions
Aardvark Discounted Cash Flow
Analysis
DCF Assumptions:

Discount Rate: 12.5%

Terminal EBITDA Multiple: 7.0 x

Model Uses “Base Case” Financial

Projections

Mid-Year Convention Used For PV

Of Cash Flows
Aardvark Discounted Cash Flow
Analysis
DCF Assumptions:

Discount Rate: 12.5%

Terminal EBITDA Multiple: 7.0 x

Model Uses “Base Case” Financial

Projections

Mid-Year Convention Used For PV

Of Cash Flows