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Martello Sells ELFIQ Networks to Adaptiv Networks

image press release
July 22, 2020

Leading Canadian SD-WAN vendor acquires 100% of Martello subsidiary in a cash and equity transaction totaling approximately $800,000. 


OTTAWA, ONJuly 22, 2020 /CNW/ – Martello Technologies Group Inc., (“Martello” or the “Company”) (TSXV: MTLO), a developer of enterprise digital experience monitoring (“DEM”) solutions, announced today the sale of substantially all the assets and certain liabilities of Elfiq Inc. (“ELFIQ” or the “Seller”) to Adaptiv Networks Inc. (“Adaptiv Networks” or the “Purchaser”),  an arm’s length Canadian SD-WAN company. The announcement is pursuant to an asset purchase agreement (the “Agreement”) between ELFIQ, a wholly-owned subsidiary of Martello, and Adaptiv Networks. ELFIQ is an SD-WAN and link balancing business which was acquired by Martello in December 2017. The transaction is subject to TSXV approval.

By acquiring ELFIQ, Adaptiv Networks will broaden its portfolio of SD-WAN solutions for mid-size enterprises and accelerate its international expansion, leveraging and commercializing the technology and assets of the ELFIQ SD-WAN and link balancing business. Martello will receive an equity stake in Adaptiv Networks. Adaptiv Networks will continue to sell and support the ELFIQ solution through the network of ELFIQ partners and resellers globally.

Under the terms of the Agreement, Adaptiv Networks will acquire substantially all of the assets of ELFIQ for a price of $800,000, subject to adjustment, for cash consideration of $500,000 and common shares of Adaptiv Networks. The cash consideration is payable in the amounts of $400,000 on closing and the issuance of a non-negotiable $100,000 promissory note due one year after closing. Sixteen ELFIQ employees will be transferred to Adaptiv Networks, and the Purchaser will assume certain liabilities relating to the purchased assets, transferred employees and the lease for the Montreal office.

Martello announced on April 28, 2020 its intention to exit the SD-WAN business via a divestment of the ELFIQ division. The Company is divesting of this line of business to focus resources on its DEM strategy. This strategy is focused on generating monthly recurring revenue from sales of solutions that improve the digital user experience for cloud services such as unified communications and video conferencing. It is expected that the divestment of ELFIQ will result in the elimination of losses relating to this division in the near-term. Operating losses for the ELFIQ division were $1.4M in the 2020 fiscal year.

“Adaptiv Networks is a Canadian SD-WAN leader that offers natural synergies for the ELFIQ business, and I’m pleased that the ELFIQ team can move forward together under new ownership to accelerate growth of the ELFIQ technology”, said John Proctor, President and CEO of Martello. “At the same time, Martello can now adopt a strengthened focus on our core growth opportunity in the DEM market and accelerate the path to positive adjusted EBITDA.”

About Martello Technologies Group

Martello Technologies Group Inc. (TSXV: MTLO) is a technology company that provides digital experience monitoring (DEM) solutions. The company develops products and solutions that provide monitoring and analytics on the performance of real-time applications on networks, while giving IT teams and service providers control and visibility of their entire IT infrastructure. Martello’s products include unified communications performance analytics software, and IT analytics software. Martello Technologies Group is a public company headquartered in Ottawa, Canada with offices in  AmsterdamGeneva, Nice, ParisDallas and New York.  Learn more at

This press release does not constitute an offer of the securities of the Company for sale in the United States. The securities of the Company have not been registered under the United States Securities Act of 1933, (the “1933 Act”) as amended, and may not be offered or sold within the United States absent registration or an exemption from registration under the 1933 Act.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any state in which such offer, solicitation or sale would be unlawful.

Neither the TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this news release.

Cautionary Note Regarding Forward-Looking Statements

This news release contains “forward-looking statements”. Forward-looking statements can be identified by words such as: “anticipate,” “intend,” “plan,” “goal,” “seek,” “believe,” “project,” “estimate,” “expect,” “strategy,” “future,” “likely,” “may,” “should,” “will” and similar references to future periods. Examples of forward-looking statements include, among others, statements we make regarding accretive monthly recurring revenues and effect of closing on the Company’s gross margins.

Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, the following:

  • Continued volatility in the capital or credit markets.
  • Our ability to maintain our current credit rating and the impact on our funding costs and competitive position if we do not do so.
  • Changes in customer demand.
  • Disruptions to our technology network including computer systems and software, as well as natural events such as severe weather, fires, floods and earthquakes or man-made or other disruptions of our operating systems, structures or equipment.
  • Delayed purchase timelines and disruptions to customer budgets, as well as Martello’s ability to maintain business continuity as a result of COVID-19.

Any forward-looking statement made by us in this news release is based only on information currently available to us and speaks only as of the date on which it is made. Except as required by applicable securities laws, we undertake no obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise.

For further information: Tracy King, Vice President of Marketing,, 613.410.7636

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