Hedge fund Elliott calls for Southwest shareholders to meet and vote on its slate of directors

abcnews.go.com:

The second largest shareholder of Southwest Airlines is calling for special meeting of shareholders to vote on its slate of eight new directors, which would represent a majority of the struggling airline’s board

The second largest shareholder of Southwest Airlines on Monday called for special meeting of shareholders to vote on its slate of eight new directors, which would represent a majority of the struggling airline's board.

Elliott Management, which has been highly critical of Southwest in recent months, is pushing for leadership changes and an overhaul of the company’s strategy. Southwest has responded by making some changes, but not enough to appease the fund, which is led by billionaire investor Paul Singer.

“Absent a thorough reconstitution of its board, the story of Southwest will remain one of empty promises and unfulfilled potential,” Elliott said in a release naming its proposed directors.

The slate includes the former CEOs of Virgin America, Air Canada and Westjet as well as a former senior official at the Department of Transportation.

The hedge fund recently acquired a stake of 11% in the struggling airline and is calling for the meeting to be held on Dec. 10. Elliott had previously requested 10 directors, but Southwest trimmed its board from 15 members to 12 in September. That change takes effect immediately following the company's 2025 annual meeting.

Elliott has argued that Southwest leaders haven’t adapted to changes in customers’ preferences and failed to modernize the airline's technology, contributing to massive flight cancellations in December 2022 that cost the airline more than $1 billion.

Southwest has improved its operations and its cancellation rate since the start of 2023 is slightly lower