Google, which has a cash pile of some $10 billion, is set to accelerate the pace at which it makes acquisitions and will consider large deals, the chief executive of the internet giant said last night at the company’s annual meeting.

Eric Schmidt’s comments follow Google’s agreed purchase of DoubleClick, the largest broker of display — or banner — advertisements on the web, last month, for $3.1 billion (£1.6 billion), its largest deal to date.

Last year it also bought YouTube, the most popular video-sharing site, for $1.65 billion.

“We are more comfortable now than we were a few years ago to buy real businesses,” Mr Schmidt said.

“But we are not doing it for competitive reasons. We are doing it because it is part of building out a portfolio.”

The comments underscored the present land grab for the relatively small number of obtainable established internet assets.

Microsoft and Yahoo!, Google's largest rivals, have both made significant acquisitions in recent weeks and are believed to have held talks over possible tie-ups of their online businesses.

Speculation that the world’s largest software developer was mulling a bid in excess of $50 billion for Yahoo!, to compete more effectively with Google, was stoked earlier this week when Steve Ballmer, the Microsoft chief executive, said that the world's largest software developer was “open to large acquisitions”.

Mr Ballmer declined to comment on whether Microsoft could consider a deal on the scale of a Yahoo! acquisition but did say that “anything is conceivable”.

Meanwhile, Mr Schmidt also suggested that Google would maintain its rapid pace in buying smaller businesses and estimated that the leader in online search-based advertising was buying about one start-up company a week.

However, he discounted the possibility of Google stepping in to buy a news organisation such as Dow Jones, the owner of The Wall Street Journal, which is being courted by News Corporation, the parent company of The Times.

He said: "We made a decision to focus primarily on user-generated content, and not on businesses where we would own the content.”

Shares in Yell, the directories business, gained 2 per cent in London this morning, valuing it at about £3.9 billion, on vague speculation that Google could make a move for the company, although private equity players were also cited as possible suitors.

Mr Schmidt added that Google had no plans to split its stock, disappointing investors.

Despite their performance in previous years, shares in the company have gained only 99 cents so far in 2007 — a 0.2 per cent rise, which trails the 5 per cent increase of the S&P 500 index.

Also at the annual meeting, a shareholder motion calling for Google to adopt measures designed to safeguard free speech online was successfully opposed by the company's board.

The vote, called by the Office of the Comptroller of New York City, which controls police, fire department and teachers’ pension funds, included a proposal for Google not to store information that can identify its users in “internet restricting countries, where political speech can be treated as a crime by the legal system”.

Google, together with other US internet companies, has met with fierce criticism after it emerged that the group's Chinese site blocked search queries pertaining to the Tiananmen Square protests of 1989.

Other policies proposed at the shareholder meeting asked that Google does not engage in "proactive censorship" and that it uses all legal means to resist demands for censorship.

The Google board has recommended a vote against the shareholder proposal.

Since two thirds of Google’s voting stock is owned by Larry Page and Sergey Brin, its co-founders, and Eric Schmidt, the chief executive, who sit on the board, the proposal had no chance of being passed.

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