The two companies yesterday confirmed that they had reached "a conditional agreement" on the sale and purchase of the 16.45ha site and buildings in Dukes Rd.
The agreement is expected to be confirmed next month along with plans for the site.
Fisher and Paykel put the property, including 31,894sq m of buildings, up for sale in July, after announcing in April that it was relocating its manufacturing offshore.
The property has a rateable value of $23 million and has been owned by Fisher and Paykel for 22 years.
Sales information described the main Dukes Road manufacturing complex as modern and inviting. An undeveloped site, including a rail siding and a warehouse were also offered for sale.
Fisher and Paykel was seeking to lease back the whole site until July 2009 and possibly lease back 4101sq m of office, laboratory and factory space for a longer period.
A move to the Taieri by Fonterra would seem to resolve several city issues related to proposed new developments.
The Otago Daily Times reported last December that Fonterra was concerned it was being squeezed out of scarce industrial land in Dunedin.
It has coolstores on the site of the proposed Awatea St stadium and its Kitchener St coolstore is near the site earmarked by the Otago Regional Council for its new $18 million steamer basin headquarters.
Fonterra told a Dunedin City Council resource consent hearing, where it opposed the regional council's plans, that it was concerned zoning changes from industrial to commercial might put constraints on the operations of its Kitchener St coolstores.
It also considered the removal of already scarce industrial land from the rental market would increase rents and that it would be "forced to find an alternative site".
In May, the city council approved the regional council building and, true to its word, Fonterra is now contemplating a move to the Taieri.
The Awatea St land it occupies is owned by East Parry Investments Ltd and has the highest rateable value ($7,200,000) of land needed for the stadium.
The Dunedin City Council is acquiring land and leases, severing tenancies and relocating businesses from Awatea St at a cost of $32.5 million.
It is understood that in addition to the purchase of new premises, Fonterra is likely to face considerable relocation and resource consent costs.
No-one from the council or the Carisbrook Stadium Trust was available yesterday to discuss what, if any, agreement existed with Fonterra over relocation costs.
The closure of the Fisher and Paykel plant in March next year will result in 430 lost jobs.
However, the company will retain up to 90 engineering research and design staff in Dunedin and plans to establish a 40-person global call centre.
The sale of the Taieri property will help fund its $100 million relocation to Thailand, Italy and Mexico.
The New Zealand Herald reports that the company has officially opened its new Thailand plant.
The factory, in Rayong, is located in the duty-free zone of the Amata City Industrial Estate and began production in March.
The site employs 230 workers.
