AOL, the faded Internet star seeking to reinvent itself as a force in online news, announced Monday it is buying The Huffington Post, the fast-growing news and opinion website, for $315 million.

The acquisition is the latest high-profile purchase by Tim Armstrong, who joined AOL from Google two years ago in an attempt to turn around a company whose name has become synonymous with the excesses of the dotcom era.

AOL said $300 million of the purchase price for The Huffington Post, which has developed a huge audience since its launch by Greek-born Arianna Huffington nearly six years ago, is in cash.

"People navigate the Web by brand and The Huffington Post is one of the best content brands on the Internet," said Armstrong, the AOL chairman and chief executive who once headed up US operations at Google.

"The acquisition of The Huffington Post will create a next-generation American media company with global reach that combines content, community, and social experiences for consumers," he said.

The Huffington Post has attracted a strong following -- nearly 25 million unique visitors a month -- for its lively mix of news, entertainment, opinion and blogs submitted by politicians, academics and celebrities.

The website, which generated revenue of around $30 million last year, has enjoyed spectacular traffic growth at a time when US newspapers are struggling to cope with a steep drop in print advertising revenue and circulation and the migration of readers to free news online.

Ariana Huffington, The Huffington Post's co-founder and editor-in-chief, will be named president and editor-in-chief of The Huffington Post Media Group, which will integrate all Huffington Post and AOL content, AOL said.

AOL properties include Engadget, TechCrunch, Patch, Moviefone, MapQuest, Black Voices, PopEater, AOL Music, AOL Latino, AutoBlog, StyleList, and other sites.

AOL said the new media group will have a combined base of 117 million visitors a month in the United States and 270 million around the world.

Huffington said the acquisition by AOL is "a merger of visions and a perfect fit for us. I told Tim that I want to stay forever. I want this to be my last act."

Asked how the left-leaning Huffington Post could be integrated with the politically neutral AOL, Huffington said The Huffington Post started as primarily political but "we've really transformed ourselves."

"Politics is only 15 percent of our traffic now," she said.

Armstrong said Huffington, whose personality and star-studded address book have been key to her site's success, has a "multiple-year contract with us."

"It's open ended," he said. "Arianna is someone we'd rather have in our building than outside the building."

Since leaving Google in 2009, Armstrong has been positioning AOL as a major player in online content. In September, AOL purchased TechCrunch, a leading Silicon Valley technology blog.

It has also invested heavily in an ambitious venture called Patch, providing local news in hundreds of communities across the United States, and a "citizen journalism" operation called Seed.

Huffington was married to oil millionaire Michael Huffington, a Republican who held a seat from California in the US House of Representatives in the 1990s and unsuccessfully ran for the US Senate in 1994.

Huffington campaigned for her husband as a staunch religious conservative, but became a liberal after their 1997 divorce and launched The Huffington Post in 2005 as an alternative to conservative news websites like the Drudge Report.

Media critic Jeff Jarvis said the purchase was a smart move for AOL.

"To execute on its content-and-advertising strategy, AOL needs brands with engagement," Jarvis said on his blog, buzzmachine.com. "Huffington Post is that.

"If this acquisition works," he continued, "it will be because Arianna really is the boss of content and gets to scale her vision and because AOL brings its key strengths -- ad sales and capital -- to what comes next."

AOL, formerly known as America Online, merged with Time Warner in 2001 at the height of the dotcom boom in what is considered one of the most disastrous mergers ever.

It was spun off by Time Warner in December into an independent company.

AOL is currently the number four gateway to the Web after Google, Microsoft and Yahoo! and its dial-up Web access business has been gradually supplanted by high-speed broadband services.

AOL shares were down 2.46 percent at 21.40 in mid-afternoon trading on Wall Street.