Phorm raises £15m to expand UK operations
LONDON - Behavourial targeting firm Phorm has sold a fifth of its shares to institutional investors to provide a £15m lifeline to keep the cash-strapped company afloat.
The company said it will use the proceeds from the sale to continue the implementation of its service in the UK and Korean markets, and for general working capital purposes, as it continues discussions with ISPs here and internationally.
The shares represent 19.4% of Phorm and will be made available on the AIM stock exchange Friday morning, after publishing its annual earnings on Thursday.
Kent Ertugrul, CEO of Phorm, said: "I am pleased that the financial community has...demonstrated its support for Phorm, with a substantially over-subscribed offering.
"We are pleased that both existing shareholders as well as a number of equally well-respected financial institutions not previously shareholders in Phorm have participated in this capital raise.
"With the addition of these new funds, we are well positioned to deliver strong growth as we engage with ISPs across the globe with a view to deployment in multiple markets."
The company, which came under fire for its ad targeting practices with BT last year, recently rebranded itself under the tagline 'Discover' with a new product that uses behavourial targeting to serve personalized web content and advertising.
Phorm said the service will be available in the UK by year end, but has yet to sign any customers, currently seeking partnerships with BT, Carphone Warehouse and Virgin Media.
The company has been trialling Webwise Discover in Korea since May 21.
Phorm was delivered a blow in April when Amazon and Wikipedia announced that they would not be using Phorm software to produce targeted ads on their websites.
The company also set up its own website to counteract claims from privacy campaigners, denouncing the groups as "privacy pirates" indulging in smear campaigns.
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