The group has acquired TAPPS BV to strengthen its presence in the European market, and could pay up to £7.9m depending on the agency's performance in meeting trading targets for the 12 months ending April 2010.
TAPPS BV specialises in generating revenue from client's email databases and websites and has access to more than 7m internet users in the Netherlands.
TMN Group said it expected the acquisition of TAPPS BV, which recorded pre-tax revenues of €4m in 2006, to be profitable within the first full year of ownership.
In November, the company made its non-executive director, Peter Harkness, chairman to replace Warren Tayler, who stepped down in October.
The group reported a 4.6% drop in after-tax profits in December to £992,000 for the six months ending October 31, but had increased revenue growth by 13% to £9m for the same period.
Mark Smith, chief executive officer of TMN Group, said: "The online direct marketing sector is experiencing rapid growth and TMN is exploiting opportunities to grow its presence in the sector and control more of the advertisers online spend.
"TAPPS has built an excellent reputation in the Netherlands and is the ideal partner to support TMN's expansion into the European market."