Artisan Partners Global Value Team Statement Regarding Director Candidates for the Board of Southwest Airlines

By: Artisan Partners Asset Management Inc. via GlobeNewswire

August 15, 2024 at 17:49 PM EDT

MILWAUKEE, Aug. 15, 2024 (GLOBE NEWSWIRE) -- The following statement is issued by the Global Value Team at Artisan Partners Limited Partnership, whose discretionary investment management clients collectively hold more than 10.8 million shares of Southwest Airlines Co. (NYSE: LUV) ("Southwest" or the "Company"), or roughly 1.8% of the Company's outstanding shares:

We have reviewed the biographies of the director nominees proposed by Elliott Investment Management, as detailed in Elliott's press release on August 13, 2024 (the "Elliott nominees"). We believe the Elliott nominees would bring a wealth of experience to the Southwest board. These nominees would add several capabilities the board is currently lacking, including a number of independent directors with former airline executive experience from across a range of business models and geographies.

The current Southwest board is simply not a credible alternative to this slate of directors. This is not a speculative point. The current board has overseen a management team that has delivered continually deteriorating financial performance over the short, medium and long term. The only argument against the Elliott nominees and in favor of the existing structure is self-preservation. Southwest Airlines does not exist to further the career interests of its board and management team, but rather the long-term interests of the owners, employees and customers, which we believe are fully aligned with a change in direction.

In all our decades of investing, we cannot recall a proposed board slate so eminently qualified for the task at hand. We believe that with just a moment of self-reflection, the current board members will agree with us on this point.

We urge the board to work with Elliott to immediately bring on all or substantially all of the proposed nominees who can then chart a new course with a new Chairman and CEO. If it will not, we will vote for the Elliott nominees should an extraordinary shareholder meeting be called.

Given the Company’s poor performance under current management, we believe the outcome here is largely determined. The shareholders want and deserve new leadership. Standing in the way of this transition will only lead to further cost and distraction at the expense of employees, customers and owners.

Enough is enough. Do the right thing.

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Eileen Kwei
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