The barbarians have come knocking at the gates for SWA

ZapBrannigan said:
So this lowers the share price for all of us, so as to lessen the influence Elliott has? Is this right? I'm not smart about this shareholder stuff. Somebody explain it to me like I'm a guy who has spent 30+ years flying airplanes and not much else.
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It is a defense mechanism that works several ways.

First if Elliott or anyone hits 12% ownership then all the other stockholders can purchase additional shares at 50% of the stock price which has the effect of diluting the Elliott or anyone’s position in a takeover bid.

It in turn can also be a way for the board to demand more per share in a takeover bid by threatening its use. This covers the board’s fiduciary responsibility to the rest of the shareholders to get maximum amount per share in a takeover bid.

Sometimes they work and sometimes they don’t, Twitter for instance adopted one when Musk started buying up shares but later didn’t use it since he so wildly overpaid for the company.

That’s the cliff’s notes of the thing as I see it. There is probably things I missed and better ways to explain it than that. I’m only on my second cup of coffee.

To me I think GK and BJ are going to circle the wagons and fight this out. I’m really curious to listen to the investor call later this month.
 
“Oh no, a so-called ‘activist investor’ has purchased a significant number of shares and is now demanding we ‘get those numbers up’!”

“Perhaps, rather than responding to the orderly demands of being a publicly-traded company, we circle-up our jerks and hide behind all the investors with a poison pill to protect our club of Not-Herbs!”

It’s not like Elliott wants to do a leveraged buy-out on LUV and this is a last-ditch defense. They want they people doing a historically mediocre job to be replaced, and those peoples’ response was to threaten the stock valuation.
 
I wonder what’s next. At the board-level, they get say over who the company officers are. Indirectly that means influence on budgets and high-level initiatives.

Certainly during my time at large old public-traded conglomerate I’ve found the board has no influence on my day-to-day and exists mostly as tacit compensation amongst the nobles.
 
Roger Roger said:
Private equity ruins everything it touches.
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Depends on the firm. I’ve worked for two portfolio companies owned by American Securities Capital Corporation and both were well run. I also worked for a portfolio company owned by J F Lehman, and they were incompetent.
 
Plata said:
Depends on the firm. I’ve worked for two portfolio companies owned by American Securities Capital Corporation and both were well run. I also worked for a portfolio company owned by J F Lehman, and they were incompetent.
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I think that the point is that they help only the (statistically) very few who might be in a position to reap their rewards. They ruin everything for everyone else. I don't doubt some are well managed for their investors.
 
Plata said:
I also worked for a portfolio company owned by J F Lehman, and they were incompetent.
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I read this as “J. Peterman”
Made myself lol

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Skåning said:
I read this as “J. Peterman”
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I'm exhausted. I've walked the terminal at Love Field a thousand times. It's never looked so strange. The faces...so cold. At a nearby gate, a child is crying. Fatherless...a bastard child, perhaps. My back aches. My heart aches. But my feet, my feet are resilient! Thank God we switched from our old uniform cap-toes to Himalayan Walking Shoes!
 
MikeD said:
There’s this guy….name is Lorenzo I think….anyhow, he loves the airline biz. Might be a good fit to take the helm of the company there.
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I'm old enough to remember "Yeah...at least Icahn won't be as bad as Lorenzo" as my recently retired grandpa nodded to his buddies silently (most of whom he'd hired in the 60's) and sipped his beer.
 
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