Phorm, the company behind Webwise - the targeted advertising system that tracks online behaviour of web users - is to issue a million new shares in a bid to raise cash.

The shares are being issued by Mirabaud Securities LLP on behalf of Phorm, and once issued will account for 6.4 percent of all shares in the company.

Phorm said it is currently concentrating its efforts on markets in Brazil and China.

The firm's targeted advertising system raised a number of privacy concerns when it was introduced in the UK two years ago and has since been dropped by BT, which was trialling the service, and TalkTalk, which had an agreement with Phorm.

"Following the successful launch in Brazil, I am pleased that shareholders have demonstrated their continuing support through this placing," said Kent Ertugrul, CEO of Phorm.

"We now intend to pursue the financial and operational strategies outlined in our recent full year results statement."

Last month, Phorm revealed it lost $29.7m in 2009.