Southwest Airlines is caving further to pressure from minority stakeholder Elliott Investment Management, which has been granted permission to own a greater share of the company’s outstanding stock.
The Dallas-based carrier disclosed in a 19 February filing with the US Securities and Exchange Commission that it has amended an existing agreement with Elliott, “increasing the maximum aggregate economic exposure that the Elliott parties may acquire from 14.9% to 19.9%” of Southwest’s shares.
The agreement’s current terms will expire after Southwest’s investor day in 2026.
It is the latest concession Southwest has made to Elliott, which has used its minority stake to succesfully push for an overhaul of the company’s board of directors, the departure of executive chairman and former chief executive Gary Kelly and sweeping strategic and operational changes.
The turnover among the company’s leadership team will continue with the retirement of longtime chief financial officer Tammy Romo on 1 April.
Southwest recently named former Breeze Airways president Tom Doxey as Romo’s replacement.
In an especially dramatic move, Southwest recently axed 15% of its corporate positions – the storied company’s first-ever layoffs.
GREEN OUTBOUND
Southwest also disclosed on 19 Februrary the planned departure of chief transformation officer Ryan Green. It did not elaborate on the circumstances surrounding Green’s decision to step down effective 1 April.
Green had taken a leading role in Southwest’s financial turnaround plan, which executives detailed during the company’s investor day in September. Southwest is ditching its egalitarian boarding system and signature no-assigned seats policy, installing new seating sections across its fleet and introducing its first overnight “red eye” flights, among other changes.
Some airline analysts have speculated that the jobs of CEO Bob Jordan and chief operating officer Ryan Watterson are also at risk amid Southwest’s wholesale changes. Elliott has previously called for Jordan’s replacement.
