Southwest Airlines Implements 'Poison Pill' to Counter Elliott Management's Influence

The airline's new shareholder rights plan aims to prevent the activist investor from gaining a controlling interest.

Southwest's plan activates if Elliott's ownership exceeds 12.5%, allowing other shareholders to buy stock at a 50% discount.
Elliott Management holds an 11% stake and has called for leadership changes due to recent financial underperformance.
CEO Bob Jordan and Chairman Gary Kelly are the primary targets of Elliott's push for new leadership.
Southwest has faced operational challenges, including a major outage in December 2022 and ongoing pricing pressures.
The airline's board believes the poison pill is necessary to fulfill its fiduciary duties to all shareholders.