Travelers check in at a Southwest counter at Hartsfield-Jackson Atlanta International Airport (ATL) in Atlanta, Georgia, Tuesday, July 23, 2024.
Elijah Nuvelaju | Bloomberg | getty images
Elliott Investment Management requested a special meeting. Southwest AirlinesIt formalized the start of a long-signaled proxy war for control of the airline’s board.
Activists said Monday they were seeking a meeting date of December 10. Elliott also reduced the number of director candidates from 10 to eight after Southwest reduced its board size from 15 to 12.
CNBC reported last month that Elliott was preparing to call a special meeting.
Southwest’s campaign will be Elliott’s first U.S. proxy fight since his 2017 showdown with Arconic.
Elliott holds an 11% stake in the airline and is seeking to oust CEO Bob Jordan. It also sought to fire Chairman Gary Kelly, but the former CEO announced in September that he would step down from the company’s board of directors due to a downsizing of Southwest’s board.
David Hess, who joined Southwest’s board in 2021, joined Arconic’s board even as the proxy war with Elliott was in full swing. Hess, who Elliott is targeting for firing, ultimately became CEO of the Alcoa spinoff shortly before the company reached an agreement with Elliott.
Elliott has never before called a special general meeting, which at Southwest has a higher approval bar than voting at a regular shareholder meeting. Elliott will have less than two months to solicit votes from shareholders large and small.
Southwest’s top shareholder, Artisan Partners, is not an activist investor but has already publicly expressed support for Elliott’s campaign.
A Southwest spokesperson did not immediately respond to a request for comment. Shares of the airline rose about 1% in premarket trading following the news.
At Investor Day on September 26, Southwest reiterated its plans to increase profits, including adding seats with more legroom and ending the non-assigned seating model. The company sided with Jordan.
Elliott dismissed Southwest’s strategy, and Jordan fired back: “In my opinion, it would be foolish for Elliott to call the plan hasty and haphazard.”
Elliott is one of the world’s most prolific activist investors, challenging companies such as: Salesforce and Starbucks.
“The candidates we put forward today are uniquely qualified to hold the company’s management accountable and ensure the company delivers improved results,” Elliott partner John Pike and portfolio manager Bobby Xu said in a statement. “These are people equipped with ,” he said.
— CNBC’s Leslie Josephs contributed to this report..
