LONDON — Time Warner Inc. yesterday offered to buy Sweden's TradeDoubler for $900 million in a bid to boost its AOL division's online advertising business in Europe.

Time Warner is offering $30.63 in cash per TradeDoubler share, valuing TradeDoubler at $900 million.

TradeDoubler shares rallied 15 percent to $32.34 in Stockholm action, indicating investor hopes for a possible counterbid.

"Although the bid level equals our target price, our initial take is that there is a strong possibility of a competing bid or that AOL will need to raise its offer," said Lars Sveder, an analyst at SEB Enskilda, in a note to clients.

TradeDoubler's board has backed the offer, and investors who hold 20 percent of its shares have also accepted the Time Warner offer. TradeDoubler's second-leading shareholder, Arctic Ventures, is among the investors backing the deal.

But pension fund Alecta, which yesterday increased its stake in the company to 10.01 percent from 7.57 percent, said the AOL offer wasn't high enough. A spokesman for Alecta said it would like the bid increased by a "reasonable" amount.

TradeDoubler has previously disclosed holding talks with other companies, though it's never identified the names of its suitors.

AOL said it plans to merge its third-party advertising network, Advertising.com, with TradeDoubler. Advertising.com buys advertising from publishers and then uses its technology to sell that advertising onto individual companies.

TradeDoubler provides online marketing for European companies including BT Group and Asda, the U.K. supermarket chain of Wal-Mart Stores. Peers of TradeDoubler include ValueClick and Adlink Internet Media.

ValueClick may make its own offer for TradeDoubler, SEB's Sveder said. WPP, the British ad giant, also may consider a TradeDoubler bid, he said.

In the first nine months of 2006, TradeDoubler reported a profit of $15 million on revenue of $176 million.

Goldman Sachs advised TradeDoubler. Up until yesterday, when it suspended coverage, it held a neutral rating on the company. The broker had said a month ago that while TradeDoubler has a strong free cash flow and an attractive strategic position in the European affiliate online market, it also sported a valuation that largely reflected that view. Morgan Stanley advised Time Warner.