AOL LLC’s bid to purchase Swedish online advertising power TradeDoubler AB for about $900 million is being met with staunch resistance by Swedish pension fund manager Alecta.
Alecta, TradeDoubler’s largest shareholder, moved to block the acquisition by raising its stock in TradeDoubler to 10.01 percent. That was enough to prevent the 90 percent shareholder approval AOL needs.
“TradeDoubler is a market leader and our view is that the bid doesn’t reflect its true value and potential growth,” Peter van Berlekom, Alecta’s head of equities, told internetnews.com through a spokesperson.
The deal a 10 percent premium above TradeDoubler’s stock from Friday’s closing price, and TradeDoubler’s board of directors is comfortable with AOL’s offer.
TradeDoubler’s board recommended that its shareholders accept the offer and shareholders representing approximately 20 percent of the outstanding shares obliged.
AOL, a Time Warner Inc. subsidiary, said its expects to complete the deal by February 26.
“With AOL and Advertising.com, we have built a robust online advertising business in Europe. TradeDoubler will help us accelerate the growth of this business,” said Jeff Bewkes, President and COO of Time Warner, in a statement.
Nils Winkler, a managing director with European online advertising firm AdTech, told internetnews.com the buy is “perfect” for AOL and that Alecta’s reticence is just posturing. He suspects Alecta is just after a higher bid.
“It’s the Swedish way to do business,” Winkler said. “They won’t block it. They just want to get some more bucks.”
Winkler also said that TradeDoubler has been one of the more “annoying” competitors for AOL property Advertising.com in Scandinavia, which is AOL’s biggest market after the UK.
Further, Winkler said the deal makes sense for AOL because TradeDoubler just opened an office in Switzerland, bordering Austria, where the company is trying to gain traction with new portals.