According to a Reuters report, hedge fund Elliott Management has secured a 10% stake in Southwest Airlines' common stock (LUV), granting them the ability to call for special meetings. The activist investor has already demanded that some members of the airline's board step down. Boyd Group International President Mike Boyd joins Catalysts to discuss this development.

Elliott Management previously announced it had an 11% stake through derivatives holdings which have since been converted into their current stake.

Boyd states that "no one knows what Elliott wants." However, he notes that the hedge fund is pushing for the removal of CEO Bob Jordan and executive chairman Gary Kelly, while advocating for "former airline executives to sit on the board." Boyd suggests that these changes may not be necessary for the airline.

Regarding Southwest's overall performance, Boyd states, "There's no huge issues here that need to be fixed, it's tweaking things." He emphasizes that the company has "a system that works," although he acknowledges that some adjustments are needed in areas such as route systems.

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This post was written by Angel Smith