Elliott calls for special meeting of shareholders to discuss Southwest future
October 14, 2024
In the latest update to an ongoing saga between Southwest Airlines and Elliott Investment management, the minority investor is again attempting to oust many of the airline’s board, having requested a special shareholder meeting to be held in early December.
After what it terms “exhaustive attempts to persuade Southwest to implement the necessary governance changes,” Elliott believes the new meeting will allow shareholders the opportunity to elect its own proposed candidates into office – with the submission of eight potential directors it believes are “uniquely qualified to hold the Company’s executive leadership accountable”.
These chosen eight include several prominent former CEOs, including David Cush (Virgin America), Gregg Satersky (WestJet), Robert Milton (Air Canada), along with the former 11 trustee of Hawaiian Airlines Josh Gotbaum and former deputy CEO, COO and CFO of Ryanair Michael Cawley. Elliott has also submitted a proposal for the removal of eight current Southwest directors.
The total number is down two from Elliott’s previous suggestion of ten nominations, despite having constantly maintained its belief that its suggestions are key to Southwest finally delivering “on its full potential for customers, employees and shareholders alike”.
Although it has yet to comment on this latest development, Southwest has continuously maintained that it has “the right strategy, the right plan and the right team in place to drive long-term value for [its] shareholders”.
Last month, Southwest appointed Robert Fornaro as the newest member of its board, explaining: “His deep experience leading multiple airlines will be instrumental as we continue with our board refreshment plan to add best-in-class directors who will bring complementary skills and hold our leadership team accountable for delivering results”.
Including Fornano, Southwest has added what it describes as ten “new highly qualified directors” over the past three years, with Fornano concluding: “I am confident in [Southwest chief executive] Bob Jordan and the leadership team’s ability to execute its transformation plan”.
