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APEX Agrees to Acquisition Terms for Purchase of Future Travel Experience (FTE)

Summary

What is being announced?
APEX has agreed to acquisition terms for the purchase of Future Travel Experience (FTE), a global events, media and innovation hub company.

Does this mean FTE is now part of APEX?
Effective immediately, FTE is an integral part of APEX.

Will APEX maintain its existing partnerships with other organizations and events?
Yes, absolutely. APEX proudly serves as the second largest international airline association in the world and the only one entirely focused on airline passenger experience. Our primary mission is to advance our industry in collaboration with others. APEX will proudly maintain its close relationships with the best of our industry in advancement of that global mission.

An Introduction to APEX and FTE

What is APEX?
APEX is the Airline Passenger Experience Association. The 41-year-old global non-profit is backed by every major airline in the world alongside all of their key, passenger-experience focused business partners.

What is FTE?
FTE is the Future Travel Experience. Founded 13 years ago, FTE serves the industry with four global events, FTE Media, and the FTE Innovation & Startup Hub.

What are FTE’s four global events and how are they complementary to APEX events?
FTE hosts four annual events: FTE Global, FTE Europe/Middle East/Africa (EMEA), FTE Ancillary, and FTE Asia EXPO. FTE Global has become a substantial annual event held in Las Vegas focused upon the future of our industry with strengths in on-the-ground, digital, ancillary, customer experience and air-transport innovation. FTE EMEA moves this year to Istanbul to be the official event for the global official opening of the world’s largest new airport. Alongside FTE EMEA, FTE Ancillary has become one of the industry’s strongest ancillary focused events for airlines worldwide. FTE Asia EXPO is an annual event based at the Marina Bay Sands in Singapore that began co-location with APEX in 2015 with APEX Asia; continued as FTE Asia EXPO in co-location with both APEX EXPO and AIX in 2016; and has maintained an annual attendance in the thousands annually since that time.

What is FTE’s Innovation & Startup Hub and how will it benefit APEX? 
The FTE Innovation & Startup Hub brings together the most forward-thinking airlines, airports, established suppliers, startups and scaleups in the air transport industry and provides a unique platform for them to share expertise, collaborate, and deliver tangible, positive change. In short, the Hub is the industry’s only network designed for the organizations and individuals who are at the forefront of innovation in the air transport sector. Several APEX global airlines and supplier members have already joined the Hub as one of the best values in the industry. The FTE Innovation & Startup Hub serves as a complementary and collaborative environment for startups in a manner completely neutral to incubator groups. For APEX, we see the FTE Innovation & Startup Hub as an option for members that would like to see more resources invested into finding startups and engaging with other like-minded organizations driving an innovation strategy. The FTE Innovation & Startup Hub demonstrates a future path for APEX to have “focus areas” that fund themselves without unfairly taking away from existing APEX member resources.

What is FTE Media?
FTE Media focuses on news for future travel, ancillary, startup, innovation, in-the-air, and on-the-ground news that affects our global travel industry. FTE Media carries responsibilities that are very beneficial to FTE’s global events and different audiences than APEX’s traditional base. FTE Media will continue forward as a stand-alone group fulfilling this unique mission.

Today, how much attendance overlap is there between APEX events and FTE events globally?
We estimate approximately 5% of APEX’s global attendees also attend FTE events in the same region annually. Including all annual events in all regions, this estimate may be slighter higher because of common speakers and airline responsibility scope. With integration success, this cross-collaborative number will increase significantly.
 

APEX and FTE History Together

How did APEX’s relationship with FTE form?
When APEX expanded its charter a decade ago, the vision was to cover the entire airline passenger experience. In 2015, the APEX Board of Directors secured the first CEO in its history with this as one of the CEO’s key objectives. On the day that the APEX’s CEO appointment was publicly announced, the APEX’s CEO and Executive Director called FTE to propose a keynote APEX address at FTE Global. APEX selected FTE as the first event for its CEO to make an industry address because of its strong on-the-ground and innovation areas of passenger experience.

How has APEX’s relationship with FTE advanced prior to acquisition terms being reached?
After the initial APEX CEO speech at FTE Global in 2015, the two organizations agreed to co-locate APEX Asia with FTE Asia EXPO that fall. From 2016 forward, APEX has been the official association for all four FTE events with APEX opening the events and in key speaking slots. With this backdrop including APEX Senior Staff and APEX Board of Directors Members in attendance, APEX has a robust four years of solid cooperative history across all four events.

APEX and FTE: From Partnership to Acquisition Terms

How did the idea of APEX acquiring FTE occur?
At the APEX Board of Directors Strategic Planning Session in early 2018, the idea was first discussed over dinner. APEX’s Board of Directors approved the outreach and FTE warmly received the outreach from APEX. From that time forward, the FTE acquisition has been a central topic for review at APEX Board of Directors meetings held under a required non-disclosure agreement. In December 2018, APEX’s Board of Directors voted to approve going to contract based on agreed high-level terms and pending final due diligence with a contract target date with FTE of 31 March 2019 that we have met.

Has APEX conducted any organizational integration before?
In 2017, APEX successfully integrated IFSA (International Flight Services Association) to be an integral part of APEX serving in-flight service. At the start of that year, APEX’s CEO became APEX/IFSA CEO. By the end of that year, IFSA members voted to bind the relationship legally so that APEX must annually approve the IFSA Board of Directors. From 2018 forward, a series of staffing integrations have occurred. APEX Education Director also became IFSA Executive Director. IFSA’s General Manager took a leadership role for APEX TECH. APEX’s event manager began officially overseeing IFSA’s event manager. In 2019, APEX’s Chief Operating Officer will also become IFSA’s Chief Operating Officer. Both APEX and IFSA have benefited from the integration with both successfully growing revenues, influence, airlines, and ability sets.

APEX' Acquisition Terms for FTE

What are the terms of the acquisition?
$0 of APEX’s current reserves and/or revenues will be used to purchase FTE. Outside of this statement, APEX cannot reveal the nature of the acquisition terms that were designed to advance the association as a global non-profit.

Is there any one-time expense related to the acquisition that will not be paid by FTE?
APEX expects an unbudgeted one-time charge for legal expertise, accounting review, and audit review. As directed by the Board of Directors after an agreed upon term sheet was reached, this one-time expense was done to make certain that the acquisition is handled in a manner to fully address APEX interests and minimize risk. Costs associated with these one-time charges are relatively low for an acquisition of this size because APEX staff did most of the work within existing time and budget. FTE covered all its own related expenses.

Will APEX maintain its full non-profit status integrating a for-profit company?
Yes. This has been very carefully reviewed. All of FTE’s core areas match with APEX non-profit areas: global thought leadership events to advance our industry, FTE Innovation & Startup Hub membership with a mission to accelerate airline passenger experience via startups, and a complementary newsletter designed to keep the industry up-to-date on advances in airline passenger experience. 

What are the detailed terms of the acquisition?
The specific terms of the acquisition agreement remain bound under a non-disclosure agreement. APEX’s Board of Directors, APEX Senior Staff, legal, accounting, and audit have approved the terms as meeting all the requirements of fully maintaining APEX’s non-profit status.

APEX Member Explanation and Benefits

Why is APEX making this move with FTE?
APEX is acquiring FTE to serve the end-to-end airline passenger experience. This will also enable APEX to significantly expand its membership base. From its in-flight entertainment roots, APEX began to cover more of the in-flight airline passenger experience marketplace a decade ago. To elevate APEX’s market expansion, APEX secured its first CEO four years ago. Two years ago, APEX integrated in-flight service including food and beverage via IFSA becoming an integral part of APEX. Now, APEX takes airline passenger experience from in-the-air to on-the-ground and beyond with FTE. APEX believes that this step will allow the association to immediately hit new levels of airline engagement and supplier participation by integrating FTE. 

How is it possible for a non-profit association to acquire a for-profit company?
A non-profit association may acquire a for-profit company like any other company. The unique nature of this transaction with FTE’s revenue streams aligning to airline passenger experience and membership fit uniquely within APEX’s existing mission as a non-profit entity.

How do the members of APEX benefit?
As we have seen at APEX, covering more of airline passenger experience draws more airlines and suppliers to our events including EXPO. This has been demonstrated at EXPO with IFSA, AIX Americas, and WACRA. This means that while maintaining our existing low membership costs, we have massively expanded APEX’s effective value for our airlines. That benefits both our airlines and suppliers. Our integration with FTE will also enable more supplier members to join APEX as we better serve the end-to-end airline passenger experience. This benefits our current members as our base grows and revenue scope further expands.

What does this mean to APEX’s size and scope?
The combination of APEX and FTE effectively doubles the size and scope of the combined events and teams. For APEX, this means double the power with a continued laser focus on airline passenger experience. The major difference will be that both current and future APEX members will have a much broader portfolio of choice, deeper bench of expertise, and broader overall team providing support. This begins effective immediately with energies and synergies increasing over each planned phase of integration.

 

APEX and FTE Event Plans

Will this change the cost and pricing for APEX and/or FTE events?
No. APEX events will maintain their existing pricing structure. FTE events will maintain their existing pricing structure with discounts for APEX members like those given previously in our partnership.

Will FTE now be a part of APEX EXPO?
No. No changes are anticipated in the first four years of integration.

Will the dates of FTE Global in Las Vegas and APEX EXPO in Southern California be complementary?
Yes. This year, FTE purposefully made its FTE Global event the week before APEX EXPO. This would enable cross-functional team members that have traveled to spend a week in total in the US combining FTE Global and APEX EXPO into one trip. FTE will take the opposite approach in 2020 by spacing the show by over a month from APEX EXPO. We will analyze if having the events closer together or further apart best serves our members.

Will APEX continue to have its own global events in addition to FTE’s global events?
APEX EXPO, APEX MultiMedia Market (MMM), and APEX TECH will absolutely continue. APEX will make FTE EMEA / FTE Ancillary in June its Europe, Middle East, and Africa thought-leadership event. This strategy complements the last APEX MMM education day being in 2017 and the APEX Middle East event in 2015 and 2018. FTE EMEA / FTE Ancillary will enable APEX to have a continuous and annual strong presence in that region. APEX Asia has been held as a standalone in China for the past two years and may continue as a standalone based on member input since it is separated by six months from FTE Asia in Singapore. 

Are FTE events now APEX events and vice versa?
No. FTE events remain FTE events with APEX branding as appropriate. APEX events remain APEX events. We will work together to deliver an end-to-end experience across all events for both airlines and suppliers in close partnership to advance the global airline passenger experience industry.

APEX and FTE Integration Plans

What are the planned integration phases for FTE?
There are three phases of integration planned for FTE.

Initial Integration
In the first two years, APEX will make FTE an integral part of the association. We anticipate welcoming on-the-ground members to APEX, encouraging interested APEX members to join the FTE Innovation & Startup Hub, and significantly increase event attendance by airlines and members across both FTE/APEX events. During this time, FTE will be treated as an integral part of APEX much like IFSA. Leadership will be maintained, FTE branding will remain absolutely intact with APEX brand integration as appropriate, innovation encouraged, and independence fully kept with input from APEX for core association values.

Full Integration
In the following two years, APEX will more fully integrate FTE’s activities into APEX’s infrastructure as needed. APEX will still fully maintain FTE’s branding, identity, innovation, and independence while APEX input will increase during this full integration period. APEX believes during these two years nearly all FTE attendees will be APEX members with the complementary value paradigms of the association established with a wider audience.

Integration Completion to Serve the Airline Passenger Experience Industry

After the initial four years of integration, we will reach the point of complete integration. With four years of integration complete, APEX will work from this point forward with FTE seamlessly on advancing our industry on an end-to-end basis.

 

Leadership Structure and APEX / FTE Staff

How will the APEX leadership structure change with this new relationship?
APEX’s leadership structure will remain the same. FTE Founder Daniel Coleman will report to APEX/IFSA CEO Joe Leader and then to the APEX Board of Directors. This falls under an existing APEX policies guideline: “The APEX CEO is authorized to act with the full authority of the board in directing the organization, its resources, and its partner vendors provided that the actions fall within budgetary and scope guidelines.”

What will happen to FTE staff?
All of the FTE staff will be retained under the leadership of FTE Founder Daniel Coleman.

 

Next Steps and Additional Information

What are the next steps?
When this FAQ is shared, it will be part of a global press release and announcement. All APEX and FTE activities and events will continue as before, but FTE will be an integral part of APEX moving forward.

Who do I call for more information?
For APEX membership, contact APEX Programs & Services Manager Haroon Qureshi at hqureshi@apex.aero. For APEX events, contact APEX Sales Manager Desiray Young at dyoung@apex.aero.

For FTE Innovation & Startup Hub membership, contact FTE Head of Strategy, Engagement, & Content Ryan Ghee at ryan@pps-publications.com. For FTE events, contact FTE Head of Commercial Corrie Thompson at corrie@pps-publications.com.

To interview APEX/IFSA CEO Joe Leader or FTE Founder Daniel Coleman about this momentous tie-together for the industry, contact APEX Director of Marketing & Communications Robin Applebaum at rapplebaum@apex.aero.

Please note that while operational aspects may be covered in interviews, no additional financial terms of the transaction may be shared due to the non-disclosure agreement.

 

©Airline Passenger Experience Association (APEX) 2016. All rights reserved.
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