SOUTHWEST AIRLINES RESPONDS TO ELLIOTT MANAGEMENT'S SHAREHOLDER LETTER AND PROVIDES UPDATE ON ENGAGEMENT
Southwest Airlines Co. (NYSE: LUV) has responded to Elliott Investment Management's recent shareholder letter and provided an update on their engagement. The company highlights its efforts to reach a constructive resolution with Elliott, including multiple meetings and an offer for Elliott to participate in the Board refreshment process. Southwest expresses disappointment in Elliott's public approach and demand for immediate CEO change.
The airline outlines its recent Board transformation plans, including six retirements in November, Gary Kelly's retirement at the 2025 Annual Meeting, and the appointment of new Directors and Committee Chairs. Southwest emphasizes its willingness to consider Elliott's Director candidates if allowed to meet them.
The company reaffirms its commitment to executing a transformational plan to improve Customer Experience and financial performance. Southwest strongly supports CEO Bob Jordan as the right leader to execute this strategy and warns against any leadership change during this critical transformation period.
Southwest Airlines Co. (NYSE: LUV) ha risposto alla recente lettera agli azionisti di Elliott Investment Management e ha fornito un aggiornamento sul loro impegno. La compagnia sottolinea i suoi sforzi per raggiungere una risoluzione costruttiva con Elliott, inclusi vari incontri e un'offerta per permettere a Elliott di partecipare al processo di rinnovamento del Consiglio. Southwest esprime delusione per l'approccio pubblico di Elliott e la richiesta di un cambiamento immediato del CEO.
La compagnia aerea delinea i suoi recenti piani di trasformazione del Consiglio, che includono sei pensionamenti a novembre, il pensionamento di Gary Kelly all'Assemblea Annuale del 2025 e la nomina di nuovi Direttori e Presidenti di Commissioni. Southwest enfatizza la sua disponibilità a considerare i candidati Direttori di Elliott se le sarà concesso incontrarli.
La compagnia riafferma il suo impegno a eseguire un piano di trasformazione per migliorare l'Esperienza del Cliente e le performance finanziarie. Southwest sostiene fermamente il CEO Bob Jordan come il leader giusto per attuare questa strategia e mette in guardia contro qualsiasi cambiamento di leadership durante questo periodo di trasformazione critico.
Southwest Airlines Co. (NYSE: LUV) ha respondido a la reciente carta de accionistas de Elliott Investment Management y ha proporcionado una actualización sobre su compromiso. La compañía destaca sus esfuerzos para alcanzar una resolución constructiva con Elliott, incluidos múltiples encuentros y una oferta para que Elliott participe en el proceso de renovación de la Junta. Southwest expresa decepción por el enfoque público de Elliott y su demanda de un cambio inmediato de CEO.
La aerolínea describe sus recientes planes de transformación de la Junta, que incluyen seis jubilaciones en noviembre, la jubilación de Gary Kelly en la Asamblea Anual de 2025 y el nombramiento de nuevos Directores y Presidentes de Comisión. Southwest enfatiza su disposición a considerar a los candidatos a Directores de Elliott si se le permite conocerlos.
La compañía reafirma su compromiso de ejecutar un plan transformacional para mejorar la Experiencia del Cliente y el rendimiento financiero. Southwest apoya firmemente al CEO Bob Jordan como el líder adecuado para llevar a cabo esta estrategia y advierte contra cualquier cambio de liderazgo durante este periodo crítico de transformación.
사우스웨스트 항공회사 (NYSE: LUV)는 엘리엇 투자 관리의 최근 주주 서한에 대해 응답하고 그들의 참여에 대한 업데이트를 제공했습니다. 이 회사는 엘리엇과의 건설적인 해결책을 찾기 위한 노력, 여러 차례의 회의 및 엘리엇이 이사회 갱신 과정에 참여할 수 있는 제안을 강조합니다. 사우스웨스트는 엘리엇의 공개적인 접근 방식과 즉각적인 CEO 변경 요구에 실망감을 표명합니다.
이 항공사는 최근 이사회의 변화 계획, 11월에 이루어지는 여섯 건의 퇴직, 2025년 정기 회의에서의 개리 켈리 퇴직, 새로운 이사 및 위원회 의장 임명에 대해 설명합니다. 사우스웨스트는 엘리엇의 이사 후보들을 만날 기회를 주어진다면 진지하게 고려할 의사를 강조합니다.
회사는 고객 경험을 개선하고 재정 성과를 향상시키기 위한 변혁 계획을 실행하겠다는 약속을 재확인합니다. 사우스웨스트는 이 전략을 실행할 올바른 지도자로 CEO 밥 조던을 강력히 지지하며, 이 중요한 변혁 기간 동안 리더십 변화에 대해 경고합니다.
Southwest Airlines Co. (NYSE: LUV) a répondu à la récente lettre des actionnaires d'Elliott Investment Management et a fourni une mise à jour sur son engagement. La société souligne ses efforts pour parvenir à une résolution constructive avec Elliott, y compris plusieurs réunions et une offre permettant à Elliott de participer au processus de renouvellement du Conseil. Southwest exprime sa déception face à l'approche publique d'Elliott et sa demande de changement immédiat de PDG.
La compagnie aérienne présente ses récents plans de transformation du Conseil, y compris six départs à la retraite en novembre, la retraite de Gary Kelly lors de l'Assemblée Générale de 2025 et la nomination de nouveaux Directeurs et Présidents de Comités. Southwest met l'accent sur sa volonté de considérer les candidats Directeurs d'Elliott si elle a la possibilité de les rencontrer.
La société réaffirme son engagement à exécuter un plan de transformation pour améliorer l'expérience client et la performance financière. Southwest soutient fermement que le PDG Bob Jordan est le leader approprié pour mettre en œuvre cette stratégie et met en garde contre tout changement de direction durant cette période de transformation critique.
Southwest Airlines Co. (NYSE: LUV) hat auf den jüngsten Aktionärsbrief von Elliott Investment Management reagiert und ein Update zu ihrem Engagement gegeben. Das Unternehmen hebt seine Bemühungen hervor, eine konstruktive Lösung mit Elliott zu erreichen, darunter mehrere Meetings und ein Angebot, dass Elliott am Erneuerungsprozess des Vorstands teilnehmen kann. Southwest zeigt sich enttäuscht über den öffentlichen Ansatz von Elliott und die Forderung nach einem sofortigen CEO-Wechsel.
Die Fluggesellschaft skizziert ihre jüngsten Pläne zur Umgestaltung des Vorstands, darunter sechs Ruhestände im November, Gary Kellys Ruhestand bei der Hauptversammlung 2025 und die Ernennung neuer Direktoren und Ausschussvorsitzender. Southwest betont seine Bereitschaft, die Direktorenkandidaten von Elliott zu berücksichtigen, wenn es erlaubt ist, sie zu treffen.
Das Unternehmen bestätigt sein Engagement für die Umsetzung eines transformierenden Plans zur Verbesserung der Kundenerfahrung und der finanziellen Leistung. Southwest unterstützt CEO Bob Jordan nachdrücklich als den richtigen Leiter zur Umsetzung dieser Strategie und warnt vor einem Führungswechsel in dieser kritischen Transformationsphase.
- Southwest is executing a transformational plan to improve Customer Experience and financial performance
- The company has added eight highly qualified independent Directors over the past three years
- Southwest is hosting an Investor Day on September 26 to present its plan to restore industry-leading performance
- Elliott Investment Management is seeking to disrupt Southwest's upcoming Investor Day
- Elliott is demanding a supermajority of the Board and immediate CEO change
- Potential risk of a Special Meeting called by Elliott, which could disrupt the company's current plans
Insights
Elliott Engagement Update
Southwest has made every effort to reach a constructive resolution with Elliott, including over a dozen phone calls with Elliott representatives, several in-person meetings and an offer for Elliott to participate in the Company's Board refreshment process and understand its views on Southwest's business and strategy. It's unfortunate that Elliott has not only completely failed to engage constructively, but today has continued its pattern of launching public ambushes and is seeking to disrupt Southwest's upcoming Investor Day.
Before even speaking with CEO Bob Jordan or hearing about the Company's plans, Elliott predetermined its position and has remained entrenched in demanding a supermajority of the Board and immediate CEO change. Since June, members of the Board have met with many investors to solicit candid feedback on Southwest's strategy and path forward. It is clear Shareholders desire that Southwest engage and seek a compromise with Elliott that is in all Shareholders' best interests and allows the Company to focus on executing its transformative strategy to move the Southwest forward. The Board has repeatedly sought to do exactly this, but acquiescing to a single Shareholder's demand for absolute control of the Company is not a compromise.
Recent Board Refreshment
Southwest recently announced the next phase of its Board transformation and invited Elliott's participation in that process. The Board's refreshment plans include six retirements in November and Executive Chairman Gary Kelly's retirement at the 2025 Annual Meeting, the anticipated appointment of four new Directors, and the naming of new Committee Chairs and a new Lead Independent Director. Before announcing these significant steps, members of the Board met with Elliott to propose a resolution framework that included giving due consideration to appointing up to three Elliott candidates to the Board. Elliott itself acknowledged that the announced changes are "unprecedented."
In response, Elliott has inexplicably refused to allow its candidates to meet with the Board and required them to sign agreements that explicitly prevent them from joining the Board without Elliott's approval. Further, all of Elliott's candidates declined or ignored direct invitations to meet with representatives of Southwest's Nominating and Corporate Governance Committee. The Southwest Board remains willing to consider in good faith Elliott's Director candidates for appointment to the Board, if Elliott will allow the Board to meet them.
In the meantime, Southwest will continue its Board refreshment to ensure the Board maintains fresh perspectives and strong oversight. The airline has added or appointed eight highly qualified independent Directors over the past three years, including the Company's newest Directors Rakesh Gangwal, co-founder of India's largest airline, InterGlobe Aviation (IndiGo) and previous executive at US Airways Group and United Airlines, and Lisa Atherton, president and CEO of Bell. The Company continues to cultivate a strong pipeline of potential candidates who would bring relevant experience to the Southwest Board.
Transformation Plan & Leadership
Southwest is executing a transformational plan including tactical and strategic initiatives that will position the airline to elevate the Customer Experience, improve financial performance and drive sustainable Shareholder value. The Company is hosting its Investor Day in
The Southwest Board strongly believes that CEO Bob Jordan is the right Leader to successfully execute the Company's robust strategy to transform the airline and deliver sustainable Shareholder value. Any Leadership change amid such a significant transformation would be detrimental to all Shareholders, and handing control of the Board to Elliott and its Director candidates – when Elliott has not articulated any ideas for improving Southwest's business plan and operations – would present a catastrophic risk to Shareholders.
Special Meeting
For months, Elliott has publicly threatened its intention to call a Special Meeting. In response, Southwest has been taking the necessary preliminary steps, including providing notice to the New York Stock Exchange of potential record dates, so that it is well prepared for all scenarios and can fulfill its special meeting obligations, especially considering it takes several weeks to set a record date under SEC rules. Elliott's suggestion that Southwest has set "false record dates" as a defensive strategy is untrue and disingenuous; Elliott is well aware that the use of rolling record dates to facilitate efficient and timely Shareholder action is common practice when the timing of an upcoming meeting (particularly a threatened Special Meeting) is unknown. If Elliott submits a request for a Special Meeting, the Board will fulfill its duties to carefully review the request in good faith. Shareholders need not take action at this time.
BofA Securities, Inc. and Morgan Stanley & Co. LLC are acting as financial advisors to Southwest Airlines and Vinson & Elkins L.L.P. and Kirkland & Ellis LLP are acting as legal advisors.
Cautionary Statement Regarding Forward-Looking Statements
This news release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934 (the "Exchange Act"). Specific forward-looking statements include, without limitation, statements related to (i) the Company's plans with respect to Board refreshment and (ii) the Company's focus areas, goals, strategies, and initiatives, including with respect to transforming the business, elevating the Customer Experience, improving financial performance, driving sustainable Shareholder value, and restoring industry-leading performance. These forward-looking statements are based on the Company's current estimates, intentions, beliefs, expectations, goals, strategies, and projections for the future and are not guarantees of future performance. Forward-looking statements involve risks, uncertainties, assumptions, and other factors that are difficult to predict and that could cause actual results to vary materially from those expressed in or indicated by them. Factors include, among others, (i) the impact of fears or actual outbreaks of diseases, extreme or severe weather and natural disasters, actions of competitors, consumer perception, economic conditions, fuel prices, banking conditions, fears or actual acts of terrorism or war, sociodemographic trends, and other factors beyond the Company's control, on consumer behavior and the Company's results of operations and business decisions, plans, strategies, and results; (ii) the Company's ability to timely and effectively implement, transition, operate, and maintain the necessary information technology systems and infrastructure to support its operations and initiatives, including with respect to revenue management; (iii) the cost and effects of the actions of activist Shareholders; (iv) the Company's ability to obtain and maintain adequate infrastructure and equipment to support its operations and initiatives; (v) the Company's dependence on The Boeing Company ("Boeing") and Boeing suppliers with respect to the Company's aircraft deliveries, fleet and capacity plans, operations, maintenance, strategies, and goals; (vi) the Company's dependence on the Federal Aviation Administration with respect to safety approvals for the Company's new cabin layout and the certification of the Boeing MAX 7 aircraft; (vii) the Company's dependence on other third parties, in particular with respect to its technology plans, its plans and expectations related to revenue management, operational reliability, fuel supply, maintenance, Global Distribution Systems, and the impact on the Company's operations and results of operations of any third party delays or non-performance; (viii) the Company's ability to timely and effectively prioritize its initiatives and focus areas and related expenditures; (ix) the impact of governmental regulations and other governmental actions on the Company's business plans, results, and operations; and (x) other factors, as described in the Company's filings with the
About Southwest Airlines Co.
Southwest Airlines Co. operates one of the world's most admired and awarded airlines, offering its one-of-a-kind value and Hospitality at 117 airports across 11 countries. Southwest took flight in 1971 to democratize the sky through friendly, reliable, and low-cost air travel and now carries more air travelers flying nonstop within
1 Based on
2 Fulltime-equivalent active Employees
3 1973-2019 annual profitability
4 Southwest's net zero by 2050 goal includes Scope 1, Scope 2, and Scope 3 Category 3 emissions only and excludes any emissions associated with non-fuel products and services, such as inflight service items.
Important Additional Information
The Company intends to file a proxy statement and a WHITE proxy card with the SEC in connection with the solicitation of proxies for the Company's next meeting of Shareholders (whether an Annual or Special Meeting of Shareholders (the "Shareholder Meeting")). SHAREHOLDERS OF THE COMPANY ARE STRONGLY ENCOURAGED TO READ SUCH PROXY STATEMENT, ACCOMPANYING WHITE PROXY CARD AND ALL OTHER DOCUMENTS FILED WITH, OR FURNISHED TO, THE SEC CAREFULLY AND IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE AS THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE SHAREHOLDER MEETING. Shareholders will be able to obtain the Company's proxy statement, any amendments or supplements to the proxy statement and other documents filed by the Company with the SEC at no charge at the SEC's website at www.sec.gov. Copies will also be available at no charge at the Company's website at https://www.southwestairlinesinvestorrelations.com/financials/sec-filings.
Participant Information
For participant information, see the Company's soliciting material filed as "DEFA14A" with the SEC on September 10, 2024 and available here.
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SOURCE Southwest Airlines Co.
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