Southwest Airlines activist investor Elliott wants a special meeting ahead of potential layoffs
A showdown between Southwest Airlines (LUV) and an activist hedge fund investor is finally coming to a head. Elliott Management says it plans to call a special shareholder meeting to help it secure control of the company.
“The urgency of management and Board change at Southwest could not be clearer,” the fund said in a letter. “In the coming weeks, we will be formally requesting a special meeting to provide you with a choice between the new directors that we have put forward — who we believe possess the qualifications and skills to guide Southwest to a brighter future — or a Board that lacks relevant expertise and has pre-committed itself to supporting failed CEO Bob Jordan.”
Elliott wants to remove Jordan from his perch, install a slate of directors to the carrier’s board, and institute a business review. Southwest did not immediately respond to a request for comment. The company has been digging itself in with a so-called “poison pill” measure that would dilute Elliott’s 11% stake.
Southwest is preparing for an investor day on Thursday, during which it will make the case that its current management team should remain in place (and will possibly announce extensive layoffs). Jordan, who has said he has no plans to leave the company voluntarily, remains firm in his convictions regarding the matter.
“Southwest has a great plan,” he said in a shareholder briefing earlier this month. “The Board and corporate governance changes announced today will enhance our focus on returning to the high level of financial performance that we—and our Shareholders—expect.”
Correction: An earlier version of this story misstated the date of Elliott’s special meeting. The date is tentative, not Oct. 7.