Activist investor Elliott takes Southwest fight to shareholders, nominates eight directors

Core Viewpoint - Elliott Investment Management is pushing for a special shareholder meeting to vote on new director candidates to influence Southwest Airlines' strategy, citing insufficient improvements from recent changes [1][2]. Group 1: Elliott's Actions and Proposals - Elliott has called for a special meeting in December to propose replacing eight directors and gaining control of the board [1]. - The hedge fund owns 10% of Southwest's common stock and manages approximately $70 billion in assets [1]. - Elliott has criticized the current board's performance and has been advocating for the ouster of CEO Bob Jordan [1][4]. Group 2: Southwest Airlines' Current Situation - Southwest Airlines has a market capitalization of$18.45 billion and has struggled to maintain profitability since the COVID-19 pandemic [1][2]. - The airline's stock price has decreased by 42% over the last five years but has seen an 8% increase in 2024 [3]. - Recent initiatives by Southwest include adding more legroom to seats, dropping the open seating system, and launching partnerships and vacation packages [2][3]. Group 3: Board Composition and Changes - The current board has 15 members, which will reduce to 13 next month and further to 12 at the next annual meeting [2]. - A new director was added earlier this year, and six directors are set to leave in November, with executive chairperson Gary Kelly departing in May next year [3][4]. - Elliott's proposed director candidates have significant industry and regulatory experience, including former executives from Ryanair and Virgin America [4].