AOL extends TradeDoubler buyout offer

AOL, a unit of Time Warner Inc. (NYSE: TWX), has extended its $900 million buyout offer in cash to TradeDoubler, the Swedish online ad firm. The company has already said it will not raise the offer after the merger was approved by TradeDoubler's board of directors in Sweden and then botched by large dissenting shareholders.

Relevant competitive and regulatory acceptances have been made, but the largest holders are still holding out for more money. The merger does not have the necessary votes to win a full approval, so AOL will have to decide if it will offer more funds or walk away. Just how much is a Swedish online ad firm worth? Apparently, more than $900 million.

AOL is extending the acceptance period to March 14, 2007 (from Feb. 28 deadline) in order to provide holders of TradeDoubler shares and warrants that have not yet tendered their securities with the opportunity. The company indicates in its press release that the conditions have been fulfilled or waived on March 19, 2007, settlement is expected to commence on or about March 21, 2007.

The formal offer from AOL was for 215 Swedish Kroners in local currency, yet shares are currently trading at 227 Swedish Kroners on the Stockholm Stock Exchange. Its 52-week trading range is 110 to 235 SK. What is interesting is that the stock had already run up more than 100% into the buyout offer and at the time the buyout would have been at record price levels.