The European Commission, the EU's antitrust watchdog, gave green light to the proposed deal after Danone agreed to sell part of its own baby food activities in Belgium and the Netherlands, together with Numico's baby milk and baby drink business in France.

"In view of the remedies offered, I am satisfied that competition will remain vigorous after the merger and that parents will continue to benefit from innovation and fair prices to feed their babies and toddlers," EU Competition commissioner Neelie Kroes said.

Danone is a worldwide company organized around two core activities, bottled water and fresh dairy products, while Numico is specialized in the manufacture and distribution of baby food and clinical nutrition.

The commission had previously raised serious doubts as to the impact of the merger on the baby food and baby milk markets in certain EU countries.

Danone has offered 12.3 billion euros ($17.7 billion) in cash to take over Numico, which owns and manufactures baby food brands such as Cow & Gate and Olvarit.

From the November 5, 2007, Prepared Foods e-Flash