Elliott Takes Stake in Southwest Airlines

Ticker: LUV · Form: SC 13D · Filed: Aug 5, 2024 · CIK: 92380

Sentiment: neutral

Topics: activist-investor, stakeholder-engagement, airline-industry

Related Tickers: LUV

TL;DR

**Elliott Management is now a major shareholder in Southwest Airlines and wants to talk strategy.**

AI Summary

Elliott Investment Management L.P. has disclosed a significant stake in Southwest Airlines Co. as of August 5, 2024. The filing indicates Elliott's intention to engage with Southwest's management regarding the company's strategic direction and operational performance. This move suggests a potential push for changes within the airline.

Why It Matters

Activist investor Elliott Management's involvement signals potential pressure on Southwest Airlines' leadership to improve performance or alter strategic direction, which could impact the company's stock price and operational decisions.

Risk Assessment

Risk Level: medium — Activist investor involvement can lead to significant corporate changes and volatility.

Key Players & Entities

FAQ

What is the primary purpose of this SC 13D filing?

The primary purpose is to disclose that Elliott Investment Management L.P. has acquired a significant stake in Southwest Airlines Co. and intends to engage with the company's management.

Who is the entity filing this Schedule 13D?

Elliott Investment Management L.P. is the entity filing this Schedule 13D.

When was the change in beneficial ownership reported?

The change in beneficial ownership was reported as of August 5, 2024.

What is the business address of Southwest Airlines Co.?

The business address of Southwest Airlines Co. is 2702 Love Field Dr, Dallas, TX 75235.

Who are the legal representatives for Elliott Investment Management L.P. in this filing?

The legal representatives are Eleazer Klein, Esq. and Adriana Schwartz, Esq. from Schulte Roth & Zabel LLP.

Filing Stats: 2,729 words · 11 min read · ~9 pages · Grade level 10.8 · Accepted 2024-08-05 17:43:02

Key Financial Figures

Filing Documents

of the Schedule 13D is incorporated herein by reference

Item 4 of the Schedule 13D is incorporated herein by reference. The aggregate cost of the shares of Common Stock directly held by the Elliott Funds is approximately $ 626,859,790. The aggregate purchase price of the Physical Derivative Agreements reported herein is approximately $502,716,516. The Reporting Person may effect purchases of the shares of Common Stock through margin accounts maintained for the Elliott Funds with prime brokers, which extend margin credit as and when required to open or carry positions in their margin accounts, subject to applicable federal margin regulations, stock exchange rules and such firms' credit policies. Positions in the shares of Common Stock may be held in margin accounts and may be pledged as collateral security for the repayment of debit balances in such accounts. Since other securities may be held in such margin accounts, it may not be possible to determine the amounts, if any, of margin used to purchase the shares of Common Stock. Item 4. PURPOSE OF TRANSACTION The Reporting Person believes the securities of the Issuer are undervalued and represent an attractive investment opportunity. The Reporting Person believes that the Issuer requires fundamental changes throughout its business to evolve its strategy and improve its performance. The Reporting Person believes the Issuer can achieve this by (1) reconstituting its board of directors (the " Board "), (2) enhancing its leadership team, including through the identification of a new CEO and a new independent Board Chair, and (3) thereafter, undergoing a comprehensive business review to develop and execute a new strategy to restore the Issuer to industry-leading performance. On each of June 10, 2024 and July 8, 2024, the Reporting Person sent a letter to the Board, which are attached hereto as Exhibit 99.1 and Exhibit 99.2 , respectively (the " Board Letters "), detailing its views with respect to the foregoing. Representatives of the Reporting Person also met with the

SIGNATURES

SIGNATURES After reasonable inquiry and to the best of its knowledge and belief, the undersigned certifies that the information set forth in this statement is true, complete and correct. DATE: August 5 , 2024 Elliott Investment Management L.P. /s/ Elliot Greenberg Name:Elliot Greenberg Title:Vice President CUSIP No. 844741108 Schedule 13D Page 8 of 8 Pages SCHEDULE 1 Transactions in the Shares of Common Stock of the Issuer by the Reporting Person During the Past Sixty (60) Days The following table sets forth all transactions in the shares of Common Stock reported herein effected during the past sixty (60) days by the Reporting Person. Except as noted below, all such transactions were effected by the Reporting Person in the open market through brokers and the price per share excludes commissions. Where a price range is provided in the column titled “Price Range ($)”, the price reported in the column titled “Price Per Share ($)” is a weighted average price. These shares of Common Stock were sold or purchased in multiple transactions at prices between the price ranges indicated in the column titled “Price Range ($)”. The Reporting Person will undertake to provide to the staff of the SEC, upon request, full information regarding the shares of Common Stock sold or purchased at each separate price. Trade Date Shares Purchased (Sold) Price Per Share ($) Price Range ($) 7/11/2024 1,050,000 26.94 26.60-27.09 7/12/2024 700,000 27.47 26.98-27.79 7/15/2024 750,000 27.70 27.24-27.87 7/16/2024 600,000 28.58 28.35-28.83 7/16/2024 400,000 28.71 28.35-28.83 7/17/2024 500,000 28.32 28.22-28.55 7/17/2024 400,000 28.34 28.22-28.55 7/18/2024 500,000 27.91 27.34-28.56 7/29/2024 1,600,000 26.44 26.15-27.03 7/30/2024 2,250,000 27.08 26.40-27.36 7/31/2024 2,500,000 27.29 26.90-27.79 8/1/2024 2,050,000 26.38 26.03-26.88 8/2/2024 2,250,000 25.19 24.89-25.75 8/5/2024 1,7

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