AOL, the internet subsidiary of Time Warner, the US media group, on Monday made a recommended SKr6.3bn (£460m, $900m, €695m) cash offer for TradeDoubler, the listed Swedish online marketing group.

The SKr215 a share offer – a 20 per cent premium to the average TradeDoubler share price over the preceding three months – reflects AOL’s drive to bolster its European advertising business following the sale of its internet access operations in markets such as the UK.

The TradeDoubler board has recommended AOL’s offer. Some 20 per cent of the Swedish group’s shareholders, including Arctic Ventures, have also given irrevocable undertakings to accept the offer.

However, Alecta, a Swedish pension group that is now TradeDoubler’s biggest shareholder with just over 10 per cent, rejected the bid, saying it undervalued the company

TradeDoubler shares rose SKr29, or more than 14 per cent, to SKr227 in afternoon Stockholm trading.

The offer comes as AOL has restructured in most of its markets to become a more advertising-led business, competing with the likes of Yahoo and Google in the growing web marketing sector.

AOL sold its UK access unit to Carphone Warehouse, the retailer and telecommunications group, for £370m cash last October.

Randy Falco, chairman and chief executive of AOL LLC, the unit making the acquisition, said: “This provides us with a unique opportunity for both TradeDoubler and us to capitalise on the continued rapid growth of online advertising and e-commerce in Europe.”

TradeDoubler’s biggest market is the UK, where it has benefited from rapid adoption of online advertising by marketers. It also operates in France and Germany as well as the Nordic regions and other parts of Europe.

The group, which numbers BT and Asda among its customers, is best known for running affiliate marketing programmes in which websites get paid for passing traffic on to third parties.

In its third-quarter filing, TradeDoubler reported a 54 per cent rise in revenues to SKr427m and an operating profit of SKr47m, up from SKr19m in the same period of 2005.

Following press speculation in December, it confirmed it had been in talks with different parties over possible transactions.

Time Warner believes the acquisition will complement, the AOL-owned company which runs an online advertising network for publishers and advertisers.

The acceptance period runs until February 19.

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