March 5 (Bloomberg) -- European regulators plan to approve Google Inc.'s proposed $3.1 billion takeover of DoubleClick Inc. without conditions, rejecting complaints by Microsoft Corp. that the deal would hurt competition, according to three people with direct knowledge of the case.

European Union antitrust officials, who have been investigating the deal since September, plan to rule that the purchase may proceed without changes, said the people, who spoke on condition of anonymity because the decision isn't public. The ruling may come as early as March 11.

``The deal will ultimately go through,'' said Greg Sterling, an analyst at Sterling Market Intelligence in San Francisco. Google, owner of the most popular Internet search engine, doesn't compete with online advertiser DoubleClick, he said.

EU approval would be a blow to Microsoft, which competes with Google in the $40.9 billion global online advertising market. Microsoft complained to U.S. and EU officials that it may be shut out of the combined company's ad network.

Jonathan Todd, a commission spokesman, declined to comment, as did Microsoft spokesman Jesse Verstraete in Brussels. The EU must rule by April 2.

The U.S. Federal Trade Commission approved the deal in December without imposing asset sales or other conditions. The acquisition, announced last year, would be a windfall for Hellman & Friedman, the San Francisco-based private-equity firm that bought DoubleClick for $1.1 billion in 2005.

`Ongoing Investigation'

``This is still an ongoing investigation, but we do not believe the transaction raises any competition concerns,'' Google spokesman Ben Novick said. ``We hope the EC will come to the same conclusions as the FTC.''

Microsoft, the world's largest software maker, trails Google in Web search services. It said last April that Google's planned acquisition would give its rival more than 80 percent of the market for ads displayed on third-party Web sites.

Microsoft plans to make it own acquisition in the market, with a $44.6 billion bid for Yahoo! Inc. That offer, announced on Feb. 1, hasn't been accepted by Yahoo's board. Microsoft bought DoubleClick rival AQuantive Inc. for $6 billion last year.

Google dominates the Internet search market with 58.5 percent. Microsoft has 9.8 percent, while Yahoo has 22.2 percent, according to January data from Reston, Virginia-based research firm ComScore Inc.

Privacy Questions

The EU decision would also be a defeat for privacy groups in the U.S. and Europe that lobbied against the deal. European consumer group BEUC said the transaction would give Mountain View, California-based Google ``significant control'' over online advertising.

The group also complained about the deal's effect on users' private data, saying that ``unprecedented and unmatched databases of user profiles'' seem to be ``in clear violation of users' privacy rights.''

Google was dependent on sponsored links -- text ads that run alongside search results -- for most of its $16.6 billion in 2007 sales. The company's shares have fallen 40 percent from their high of $747.24 on Nov. 7 on investor concern that fewer users are clicking on its Internet ads.

DoubleClick's products help advertisers measure how effective their ads are and allow Web publishers to track and manage online advertising. The ads are typically so-called display ads, which include graphics or animation.

Yahoo Deal

Microsoft's bid for Sunnyvale, California-based Yahoo would create the leading display ad company. That would save Microsoft from spending a decade -- and tens of billions of dollars -- to catch Google with internal development, said Peter Misek, an analyst with Canaccord Capital Inc. in Toronto.

Microsoft, based in Redmond, Washington, said in a letter to the FTC and the EU that regulators should require Google to ensure fair and ``unbiased'' access to its tools that place ads on Web sites. Microsoft said Google shouldn't be allowed to have exclusive deals or manipulate DoubleClick's software to give it preferential access to publishers' ad inventory.

Another Microsoft concern was that Web sites would start dealing with a single company for all their advertising, rather than shopping around for different services, Sterling said.

Google rose $3.10 to $447.70 at 4 p.m. New York time in Nasdaq Stock Market trading. Microsoft climbed 53 cents to $28.12. Yahoo advanced 61 cents to $28.67.

To contact the reporter on this story: Matthew Newman in Brussels at mnewman6@bloomberg.net

Last Updated: March 5, 2008 16:15 EST