News: CGC UPDATE 1-Australia's Costa Group backs Paine Schwartz's $963 mln buyout offer

(Adds details on the offer in paragraphs 2 to 4)

Sept 22 (Reuters) - Costa Group Holdings (CGC) said on Friday it has entered an agreement to be bought out by a consortium led by private equity firm Paine Schwartz Partners in a deal valuing the horticulture company at A$1.50 billion ($962.6 million).

Under the proposal, Costa's shareholders would receive A$3.20 apiece for the remaining 85.16% stake that Paine Schwartz does not already own.

The private equity firm had initially offered to buy Costa, Australia's leading grower, packer and marketer of fresh fruit and vegetables, at A$3.50 a share

in July , but trimmed the offer earlier this week, deeming it the best and final price.

Costa's board unanimously recommended that shareholders vote in favour of the deal.

($1 = 1.5584 Australian dollars)