Elliott Investment Management may nominate up to 10 director candidates to Southwest Airlines' board. The airline has a board of 15 members. After acquiring a $2bn stake in the airline in June, the activist investor is looking to shake up the leadership to turnaround the airline.
The candidates were "selected through a months-long global search for the best individuals," Elliott said in a statement. The individuals have a range of aviation backgrounds and expertise - including former deputy CEO of Ryanair Michael Cawley, former CEO of Virgin America David Cush, and former WestJet CEO Gregg Saretsky.
"If elected, Elliott is confident that these candidates will chart a brighter future for Southwest, provide the board with much-needed expertise and relevant industry experience and help restore the company's position as an industry-leading airline with best-in-class profitability," the company continued.
Southwest said in a statement Elliott agreed to a meeting in early September to discuss a “collaborative resolution” including board member changes and other enhancements. The airline said: “Elliott unilaterally decided instead to publicly announce its intention to replace a majority of Southwest Airlines' Board.”
The airline continued: “The Southwest Airlines board and executive leadership team remain open to conversations with Elliott to discuss ideas to drive shareholder value, and the board will evaluate Elliott's proposed nominees as part of its ongoing Board refreshment process.”
Elliott said it "plans to move forward expeditiously to formally nominate the candidates". On August, 14, 2024, an amended statement of beneficial ownership SEC filing from Southwest Airlines detailed the list of candidates.
The investor wants to implement key changes to leadership as well as product offerings in an effort to bring Southwest's shares to reach $49. The airline's stock has fallen over 24% in the past six months.
Elliott said in the statement it has an approximate 11% economic interest in the airline. It said recently in a stock filing it had a 7% beneficial ownership. Once it reaches 10%, the company can call a special meeting.
Southwest had deployed a 'poison pill' last month to fend off the company.