The publisher of leading titles, including Grazia, Heat and Empire magazines, is said to be on the hunt for small "bolt-on" acquisitions to complement its existing portfolio.
A source with knowledge of the process said: "Bauer is on the acquisition trail. I know this for a fact.
"It has missed out on some big deals but it wants to grow the business. It is looking at smaller, bolt-in acquisitions.
"Publishers are not undergoing major launches. Instead, they are looking at growing businesses by buying other magazine brands."
A Bauer spokesperson confirmed: "At Bauer Media, we are always looking at opportunities to develop our portfolio, but we do not comment on any M&A activity."
The company was one of the leading contenders for a possible takeover of BBC Worldwide's stable of magazines.
Bauer had submitted a bid early in the tender process but the BBC announced it has entered into a period of "exclusive negotiations" with private equity firm Exponent last week.
According to financial records filed with Companies House in October, Bauer recorded a pre-tax profit of £51.9m for the year ending 31 December 2009.
The publisher reported operating profits during 2009 to 31 December of £53.5m.
The financial record also revealed that in 2009 Bauer shed the Yospace Technologies mobile blogging business, which it bought in 2007, and a 40% stake in NextGen Publishing in 2008. They were sold for £1 and 50p respectively.
Bauer, formerly known as Emap before it was taken over by German company H Bauer in 2007, acquired Yospace Technologies for £8.9m and the NextGen Publishing share for £4m.
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