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The deal with joint owner venture capital firm BC Partners sees the Guardian Media Group buy the 52% in the company that it does not already own. The deal will raise its stake in the firm to 100% in a transaction that values the Trader Media Group at £1.14bn.

The Guardian Media Group said the deal was a major strategic acquisition and that it would be used to further secure the financial independence of The Guardian and The Observer.

Earlier this year there was speculation that the GMG was abandoning efforts to buy Trader Media and had instead turned its attention to Capital Radio.

There was talk of a possible bid for Capital in May, with speculation that GMG was to seriously expand the size of its radio business, which includes Jazz FM, Real Radio in South Wales, Central Scotland and Yorkshire, and Scot FM.

However, no bid emerged and reports filtered through that GMG was back in talks with BC Partners.

Bob Phillis, chief executive of GMG and chairman of TMG, said: "TMG is a business that we know intimately and bringing ownership within GMG is a major strategic acquisition. The profitability and cash flows from TMG will further secure the financial independence of The Guardian and The Observer, thus underpinning their editorial independence -- the two key objectives of our owners, the Scott Trust.”

Auto Trader is published by Trader Media in 13 regional editions in the UK and the Republic of Ireland, with a weekly circulation of 340,000. The company also runs Europe’s busiest automotive website, www.autotrader.co.uk, which carries more than 250,000 cars for sale, generating in excess of 118m page impressions and 23m searches each month.

In all, Trader Media publishes 70 different publications, including Ad Trader, Auto Freeway, Bike Trader and Top Marques, as well as having equivalent operations in Italy, Holland and South Africa.

Graham Luff, chief executive of TMG, said: "GMG has had an interest in the Auto Trader business for more than 20 years and is the natural home for our business. I am convinced that complete ownership by GMG is in the best interests of both Trader Media Group and its employees.”

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