The acquisition, which could be announced by the end of the week would be the company's biggest to date and be funded mainly through a placing of shares with institutions.
A hint that a deal was close to being struck was given last month by Chris Ingram, executive chairman, who said CIA could spend up to pounds 100m on acquisitions over the next four years.
The agency needs to grow rapidly to avoid the risk of being swallowed up by rival advertising networks, as the media buying market continues to consolidate.
Mr Ingram, who has been at the helm of CIA for 21 years, would not comment on details last night, but he did not deny that acquisitions were in the pipeline.
The move would hasten the completion of the company's international network, enabling CIA to service multinational clients. However, the group still needs to address its absence in the American market, as well as plugging holes in the Far East.
City analysts have been expecting news of international expansion for some months. James Capel recently replaced Merrill Lynch as CIA's brokers, a development which some took to indicate that corporate activity was imminent.
CIA recently announced a drop in profits for 1996 from pounds 6.68m to pounds 4.92m, entirely due to a pounds 1.8m settlement the company had to make with several ITV companies. The dispute was over an alleged shortfall in CIA clients' spending with the ITV companies.
Although company insiders stressed that some cash would be used to pay for the Scandinavian deal, the majority of the funding would be provided from a placing of shares.
A restructuring of the board earlier this year was in part in preparation for acquisitions. Mr Ingram became executive chairman, and David Reich, former non-executive chairman of the group's European operations, became chief executive.
CIA posted billings of over pounds 1bn last year, and won several new clients such as Swatch, Shell and Lever.
Mr Ingram said recently that he hoped CIA would be one of the top six media buyers by the start of the next millennium. To achieve his goal, the agency would need to quadruple its billings.