New Zealand Dairy Foods, owned by billionaire Graeme Hart, has agreed to sell its stake in Kapiti Cheeses to United Milk for NZ$5.67 (US$3.33) a share.

Hart recently bought a 10.3% stake in specialty cheese and ice-cream manufacturer Kapiti Cheeses at $3.75 per share. The board of Kapiti Cheeses, however, was concerned that Hart was trying to stop bidders that were participating in a competitive tender from buying the company, reported the Dominion Post.

In a bid to prevent Hart from blocking the takeover, the board proposed that the stake a buyer must reach before it is required to buy the remaining shares in the company be lowered from 90% to 75%. That would mean that Hart's 10.3% stake would be insufficient to block the takeover bid.

Following Hart's decision to sell his stake, the board of Kapiti Cheeses has recommended that its shareholders accept an offer by independent dairy group United Milk to buy 100% of the company for $15m, around $5.67 per share, reported the New Zealand Press Association.