What's happened
Elliott Investment Management is intensifying its campaign to overhaul Southwest Airlines' leadership, seeking to replace CEO Bob Jordan and Executive Chairman Gary Kelly. The activist hedge fund aims to replace 10 of the 15 board members, citing the airline's poor performance and lack of industry expertise among current directors.
Why it matters
What the papers say
According to the New York Post, Elliott Management has proposed a slate of directors with significant airline experience, contrasting with the current board's lack of such expertise. CEO Bob Jordan has been actively seeking investor support, stating, 'If it’s a fight they want, it’s a fight they will get.' Meanwhile, Elliott's aggressive stance has raised concerns about the potential impact on Southwest's brand, as noted in Axios, which highlights the tension between maintaining a low-cost model and the pressures of activist investors. The Dallas-based airline's stock has seen a decline, with shares down 24% over the past year, prompting Elliott's intervention as a call for urgent reform.
How we got here
Elliott Management, known for its aggressive tactics, has been pushing for significant changes at Southwest Airlines since June 2024. The firm has criticized the airline's leadership for its declining stock price and operational challenges, prompting a proxy fight for board control.
Common question
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What is Elliott Management's strategy for Southwest Airlines?
Elliott Management is making headlines with its aggressive strategy aimed at overhauling Southwest Airlines' leadership. As the hedge fund pushes to replace a significant portion of the airline's board, many are left wondering about the implications of this move. What does this mean for the future of Southwest Airlines and its current leadership? Below, we explore key questions surrounding Elliott Management's influence and the potential outcomes of their campaign.
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What is Elliott Management's plan for Southwest Airlines?
Elliott Management is making headlines with its aggressive campaign to overhaul Southwest Airlines' leadership. As tensions rise between the hedge fund and the airline's current management, many are left wondering what this means for the future of the airline. Below are some common questions and answers regarding this unfolding situation.
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More on these topics
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Southwest Airlines Co. is a major American airline headquartered in Dallas, Texas, and is the world's largest low-cost carrier.
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Elliott Management Corporation is an American investment management firm. It is also one of the largest activist funds in the world.
It is the management affiliate of American hedge funds Elliott Associates L.P. and Elliott International Limited. The Elli
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Robert Jordan is the Executive Vice President of Corporate Services for Southwest Airlines. On 23 June 2021, it was announced that he would succeed Gary C. Kelly as the sixth CEO of the company in February 2022.
Jordan graduated from Texas A&M Univers