The Succession-style battle at Southwest just had another major update

Over the past couple of months, the battle for control of the Dallas-based Southwest Airlines (LUV) has been nothing but worthy of a season of the hit HBO boardroom show "Succession."

In its efforts to appear current chief executive Bob Jordan and an awful lot of the board pushed out over what it classifies as "poor execution and leadership's stubborn unwillingness to adapt," hedge fund Elliott Investment Management has purchased enough company stock a good technique to position the question to a shareholder vote. To organize for it, it sent out a letter telling shareholders to purchase back their shares to make them eligible in a vote which may perhaps happen as soon as the drawing close days.

Related: Southwest Airlines 'Succession'-style investor battle takes first victims

"If any of your shares are currently on loan, which you'd instruct your broker to recall any loaned shares to ensure that you do might be 'long' to your entire eligible position," Elliott Partner John Pike and Portfolio Manager Bobby Xu wrote in a Sept. 24 letter addressed to shareholders. "Shareholders ought to be ready for whatever record date is set by the Southwest Board."

Leadership change 'counterproductive': A brand new player within the Southwest proxy battle emerges

The letter also accuses the airline of setting "false record dates" with banks and brokers so so you might definitely be capable to limit who should be on the books to vote when the special shareholder meeting is most often which shall be is known as without notice. Probably essentially the most modern major update comes now that Indian low-cost carrier IndiGo co-founder and current Southwest board member Rakesh Gangwal also took the step of buying more than $100 million of the airline's stock so so you might definitely be capable to stabilize shares amid upheaval resulted in by Elliott's proxy battle.

More Commute:

• A brand new go forwards and backwards term is taking on the cyber web (and reaching airlines and hotels)
• The ten best airline stocks to purchase now
• Airlines see a new kind of traveler at the front of the plane

Appointed to Southwest's board in July 2024, Gangwal emerged as a last-minute ally to the airline's current leadership. He has now purchased three.6 million shares valued at approximately $100 every.

"I in truth have faith changing the board structure and top leadership beyond what has been already announced, may well be counterproductive and now not within the appropriate interest of shareholders," Gangwal said in a statement regarding the actual fact that Southwest already responded to investor pressure by pushing out chairman Gary Kelly and an awful lot of existing board members.

Related: Get the appropriate cruise tips, deals, and news on the ships from our expert cruiser

Probably essentially the most modern: Here is where the Southwest proxy battle is at now

All within the hassle to own enough shares a good technique to unbalance Elliott's control, Jordan and Kelly also bought or moved around their personal shares within the airline. The filing that the airline made with the U.S. Securities and Exchange Commission (SEC) shows that Jordan bought up Ninety seven,872 shares valued at $29.sixty three every while Kelly moved 84,212 of shares right into a family have faith while also straight away buying an additional 33,921 shares.

Neither of these purchases significantly alters control of the airline — after his purchase, Gangwal now owns approximately 0.6% of the company while more than 10% is needed to call shareholder meetings — but is intended to create corresponding to an airline that other investors are putting their own money into.

Elliott, in turn, has during the past criticized Gangwal as a person who became "chosen partly for that reason fact of his beef up for the company's status-quo leadership and plan" and most often which shall be is known as his actions on this regard as "only solidify[ing] the case for leadership change."

Related: Veteran fund manager sees world of pain coming for stocks