Travelers check in at a Southwest counter at Hartsfield-Jackson Atlanta International Airport (ATL) in Atlanta, Georgia, US, on Tuesday, July 23, 2024.
Elijah Nouvelage | Bloomberg | Getty Images
Elliott Investment Management has requested a special meeting at Southwest Airlines, formalizing the launch of a long-signaled proxy fight for control of the carrier’s board.
The activist is seeking a meeting date of Dec. 10, it said Monday. Elliott has also trimmed the size of its board slate from 10 director candidates to eight, after Southwest shrunk its board size from 15 to 12.
Tech Zone Daily 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 it took on Arconic in 2017.
Elliott has an 11% stake in the airline and is seeking the ouster of CEO Bob Jordan. It had also been looking to remove executive chairman Gary Kelly, but the former CEO announced he would step off the company’s board in the September shuffle that shrank Southwest’s board.
Elliott has never before called for a special meeting, which at Southwest carries a higher threshold of approval compared with voting at a regularly scheduled shareholder meeting. Elliott will have a little less than two months to solicit votes from shareholders large and small.
One top Southwest shareholder, Artisan Partners, while not an activist investor, has already publicly expressed its support for Elliott’s campaign.
Southwest representatives did not immediately return a request for comment. The airline’s shares rose roughly 1% in premarket trading on the news.
At an investor day late last month, Southwest reiterated its plans to drum up revenue, including adding seats with extra legroom and ending its assigned seating model. The company has stood by Jordan.
Elliott dismissed Southwest’s strategy, and Jordan fired back: “For Elliott to call that plan rushed and haphazard in my opinion, is inane.”
Elliott is one of the most prolific activist investors in the world, mounting challenges at companies including Salesforce and Starbucks.
“The nominees we have put forward today are uniquely qualified to hold the company’s executive leadership accountable and ensure that the company delivers improved results,” Elliott partner John Pike and portfolio manager Bobby Xu said in a statement.
— Tech Zone Daily’s Leslie Josephs contributed to this report.