KEY POINTS:
Farmer owners of Australian Co-operative Foods have overwhelmingly agreed to sell the business to Fonterra rival National Foods.
The A$5.65 cash per share deal for the company, which trades as Dairy Farmers, was supported by more than 96 per cent of votes.
National Foods managing director Ashley Waugh said the vote would be seen by future generations of farmers as a historic moment that would drive significant change to improve industry efficiency for the benefit of all stakeholders.
There was no question that continued growth in exports to Southeast Asia waspart of the plan, although the commodity industry was not the focus, Waugh said.
"There are some very good companies in Australia and New Zealand whose core business is marketing commodities to South East Asia and other parts of the world. We're a branded foodcompany, our business is about brands in Australia and across Southeast Asia."
The deal represented an enterprise value of A$910 million, with the combined business expectedto have revenue of about A$3.5 billion, including about A$2 billion from milk.
Fonterra had earlier lodged an interest to buy the company with the Australian Competition and Consumer Commission but withdrew in June soon after buying the yoghurt and dairy dessert business of Nestle Australia.
Fonterra's Nestle deal included the 28-year right to manufacture, market and sell Nestle brands, including Ski which is under licence to Dairy Farmers but reverts in 2012.
Waugh said National Foods would sell the Ski licence to Fonterra but would not discuss the value because negotiations were still active.
To get commission approval National Foods agreed to sella sustainable, competitive business in New South Wales and South Australia.
"I can confirm that we are in discussions with a number of interested parties in Australia and offshore," Waugh said.
A court hearing to seek approval for the scheme would be held on November 18.
