Southwest Airlines : After a prolonged dispute that lasted for months, Southwest Airlines has agreed to restructure board leadership as part of a new settlement in response to Elliott Investment Management’s demands.
Six directors, including longtime CEO and executive chairman Gary Kelly, will accelerate their retirements until November 1. Kelly was originally scheduled to leave in 2025, and the directors were scheduled to leave following a board meeting in November. Additionally, Patricia Watson, Dave Cush, Sarah Feinberg, Dave Grissen, and Gregg Saretsky have been appointed to the board of directors as independent directors. All five are Elliott’s slate of candidates. Saretsky will serve as chair of the board’s finance committee, which also includes Cush and three additional directors that the board will appoint.
After Elliott’s calls for the company’s leader to be replaced, Advertising CEO Bob Jordan appears to be safe.
Kelly stated in a press release, “We are pleased to have reached a collaborative resolution with Elliott” and “continue our Board refreshment with the addition of new directors who bring complementary skills and experience.” I am confident that this board will continue to hold the leadership team accountable for delivering financial performance and carrying out its transformational plan.
Related: In the Southwest proxy fight, activist investor Elliott’s new weapon is: a podcast The activist investor also renounced its plan to propose candidates for the board of directors and withdrew its request to call a special meeting of shareholders.
Advertisement Pierre Breber, who previously served as Chevron’s chief financial officer, has also been appointed to the board. At Southwest’s annual shareholder meeting in 2025, the new board will have 13 members and appoint a new independent chairman. Following his departure, Kelly will take on the role of chairman emeritus.
John Pike, partner of Elliott, and Bobby Xu, portfolio manager, stated in a release, “We are pleased to have come to an agreement with Southwest on the addition of six new directors that will enhance and revitalize its board.” They are all highly qualified and will bring a wide range of skills and experiences to Southwest’s management under a new board chairman.
Elliott’s podcast for interviewing board candidates had just been released.
During the company’s quarterly earnings call on Thursday, additional details are anticipated.
