Southwest Airlines has reached a settlement with activist investor Elliott Investment Management after months of negotiations.
on Thursday morning that the agreement would restructure the board’s leadership, including the retirements of longtime CEO and executive chairman Gary Kelly and six other directors.These changes will go into effect on Nov. 1, 2024. Kelly was previously set to leave in 2025, and the directors were going to leave after a November board meeting. Following Kelly's departure from the board, he will assume the title of Chairman Emeritus.
“We are pleased to have reached a collaborative resolution with Elliott, continuing our board refreshment with the addition of new directors who bring complementary skills and experience," Kelly said in a press release."I am confident this board will continue to hold the leadership team accountable for executing its transformational plan and delivering financial performance.
The airline said that the newly reconstituted board of directors will appoint a new independent chairman, and the board will be reduced to 13 members as of Southwest’s 2025 Annual Shareholder Meeting. “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," Elliott Partner John Pike and Portfolio Manager Bobby Xu said."They are all highly qualified and will bring diverse skills and backgrounds to the task of overseeing Southwest under the leadership of a new board chairman.
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