Top Southwest shareholder signals support for Elliott Management’s activist campaign

“We are writing today to urge the Board to reconstitute itself and upgrade the Company’s leadership,” O’Keefe and McKinnon wrote.

Southwest said in a statement the company welcomed feedback from all shareholders. “The Board is confident in the ability of our CEO and Leadership Team to evolve the business and drive long-term value for all stakeholders,” the statement read.

Artisan, a $158.6 billion asset manager, owns a 1.8% stake in Southwest, making it the 10th-largest shareholder of record. It has held a stake in the airline on and off since 2001, according to FactSet data, amassing its current holdings beginning in 2020.

O’Keefe and McKinnon oversee Artisan’s Global Value Team, which manages $28 billion in assets.

Elliott has an economic interest in Southwest worth $1.9 billion and is seeking a comprehensive business review in addition to the ouster of Jordan and Kelly.

Earlier Wednesday, Jordan said he had no plans to resign in the face of Elliott’s campaign, adding that Elliott was welcome to present its ideas but would not be “directing the company,” Reuters reported.

The move is likely to add pressure to the company, however. Elliott said in its presentation that it had surveyed shareholders, as well as employees and customers, before revealing its stake.

Other top Southwest shareholders include Putnam Investment Management and T. Rowe Price, as well as BlackRock and Vanguard. Together, not including Elliott’s economic interest, institutional shareholders control around 60% of Southwest’s shares outstanding.

— CNBC’s Leslie Josephs contributed to this report.