Southwest deploys poison pill against activist investor

Southwest Airlines has adopted a shareholders rights plan following its approval from the board of directors on July 2, 2024. The poison pill was deployed to defend against activist investor Elliott Investment Management bought a $1.9bn stake in Southwest, representing an approximate 11% interest in the airline. The limited-duration shareholder rights plan will be triggered if an entity is or becomes the beneficial owner of 12.5% or more of the company’s outstanding common stock without the prior approval of the board. Any rights held by this entity “will be null and void and may not be exercised”, the airline explained