13D weekly report - Oct 14, 2024 to Oct 18, 2024

JANA Partners and Continental Grain Company to Engage with Lamb Weston Holdings (LW) on Strategic Issues

Key Summary: On October 18, 2024, JANA Partners and Continental Grain Company announced plans to engage with the board and management on issues like shareholder underperformance, operational deficiencies, and strategic alternatives due to the company's poor performance history.

Market Cap: $11 billion | Lamb Weston Holdings, Inc. engages in the production, distribution, and marketing of frozen potato products in the United States, Canada, Mexico, and internationally.

On October 18, 2024, JANA Partners and Continental Grain Company (together 5.4%) announced plans to engage with the company's board and management to address key issues, including shareholder underperformance, operational deficiencies, capital spending alignment, share repurchase strategies, investor communications, management compensation, environmental standards, resource oversight, corporate governance, and potential strategic alternatives due to the company's poor performance history. Source

Winvest Investment Fund Plans Engagement with LogicMark (LGMK) on Strategy and Leadership

Key Summary: On October 18, 2024, The Winvest Investment Fund Management Corp. (67.2%) announced plans to engage with the board about business strategies and potentially elect new board members.

Market Cap: $1 million | LogicMark, Inc. provides personal emergency response systems (PERS), health communications devices, and Internet of Things (IoT) technology that creates a connected care platform in the United States.

On October 18, 2024, The Winvest Investment Fund Management Corp. (67.2%) stated its plans to engage with the board and management about the company's business strategies and operations, potentially seeking to elect new board members. Source

Southwest Gas Holdings (SWX) and Carl Icahn Enter Updated Cooperation Agreement, Allowing Designation of Board Members and Committee Participation

Key Summary: Carl Icahn (4.91%) raised concerns about the company’s $1.98 billion acquisition of Questar Pipeline Co from Dominion Energy in October 2021, prompting a short-term stockholder rights plan and several inadequate acquisition offers. A cooperation agreement in May 2022 allowed Icahn to nominate directors and explore strategic alternatives. By November 21, 2023, an updated agreement permitted him to designate up to four board members for the 2024 AGM. On October 15, 2024, the company, Icahn, and Andrew J. Teno entered into a new Updated Cooperation Agreement. Additionally, on October 24, 2023, Corvex Management (5.8%) announced plans to engage with the Board to unlock value in the company’s utility franchises and investment in Centuri Group, advocating for Centuri's separation and strategies to enhance shareholder value.

Market Cap: $5.4 billion | Southwest Gas Holdings, Inc., through its subsidiaries, purchases, distributes, and transports natural gas in Arizona, Nevada, and California.

(i) Carl Icahn

Background

• In October 2021, the company announced a $1.98 billion acquisition of Questar Pipeline Co from Dominion Energy Inc. Carl Icahn (4.91%) expressed concerns about this move, suggesting it would diminish shareholder value. The company then implemented a short-term stockholder rights plan in response. Subsequently, Carl Icahn made multiple offers to acquire the company's outstanding shares, with the board deeming them inadequate. This led to a back-and-forth between the company and Icahn. Ultimately, they entered into a cooperation agreement in May 2022, allowing Icahn to nominate directors and explore strategic alternatives, including a potential sale of the company. In August 2022, certain provisions of the Cooperation Agreement were amended, leading to changes in board appointments.
• On November 21, 2023, the company and Carl Icahn (15.4%) entered into an Amended and Restated Cooperation Agreement, which supersedes the previous agreement from October 24, 2022. This Updated Cooperation Agreement grants Carl Icahn the right to designate up to 4 individuals, known as "Icahn Designees," to serve on the Board, and the company has agreed to nominate these individuals for election at the 2024 AGM. The Updated Cooperation Agreement also allows the Icahn Designees to participate in various committees of the Board, including the Strategic Transactions Committee. Source

Update

On October 15, 2024, the company, Carl Icahn, and Andrew J. Teno entered into an Updated Cooperation Agreement, which supersedes the previous agreement from November 21, 2023. This new agreement maintains key provisions, including the right to nominate directors for the 2025 Annual Meeting. Carl Icahn is entitled to designate up to four individuals—Andrew W. Evans, Henry Linginfelter, Ruby Sharma, and Andrew Teno (collectively referred to as “Icahn Designees”)—who will be nominated for election at the upcoming meeting. Additionally, the Icahn Designees will participate in the Strategic Transactions Committee and other board committees. Source

(ii) Corvex Management

 On October 24, 2023, Corvex Management (5.8%) stated its plan to engage with the Board and management to explore ways to unlock the value of the company's core utility franchises and its investment in Centuri Group, Inc. They support the separation of Centuri but believe that the company's regulated portfolio, Southwest Gas Corporation, is undervalued compared to its authorized rate base and market peers. They intend to discuss strategies to enhance shareholder value, including improving returns on capital, potential restructuring, or a sale of the company.  Source

Elliott Calls for Special Meeting of Shareholders in Order to Bring Urgently Needed Change to Southwest (LUV)

Key Summary: On July 8, 2024, Elliott Investment Management L.P. called for a leadership overhaul at Southwest Airlines due to ongoing underperformance and dissatisfaction, urging the Board to reconstitute with independent airline executives and source a new CEO externally. Following this, Elliott proposed a fundamental strategy change and announced plans to nominate ten board candidates, criticizing current management for poor performance. On October 14, Elliott requested a Special Meeting of Shareholders on December 10, 2024, to elect eight independent nominees and remove eight current directors, stressing the urgent need for governance reform.

Market Cap: $18 billion| Southwest Airlines Co. operates as a passenger airline company that provides scheduled air transportation services in the United States and near-international markets.

• On July 8, 2024, Elliott Investment Management L.P. urged the Board to implement a leadership overhaul due to sustained underperformance and shareholder dissatisfaction. Following extensive feedback from shareholders and industry stakeholders, Elliott criticized recent actions by the Board, such as reducing revenue guidance and adopting a "poison pill" to thwart Elliott's stake increase. Elliott advocated for immediate Board reconstitution with independent, experienced airline executives and a new CEO sourced externally.
• Press release
• On August 5, 2024, Elliott Investment Management L.P. stated its belief that the company needed fundamental changes to improve its strategy and performance. They proposed reconstituting the Board, enhancing the leadership team by finding a new CEO and independent Board Chair, and conducting a comprehensive business review to develop and implement a new strategy to achieve industry-leading performance. Source
• On August 13, 2024, Elliott Investment Management L.P. (11%) stated that it intends to nominate ten candidates to the Board. This move follows Elliott’s call for board reconstitution, new leadership installation, and a comprehensive business review to restore Southwest’s industry-leading position. Highlighting ongoing poor performance and board resistance, Elliott emphasizes the need for change. Source
• On August 26, 2024, Elliott Investment Management sent a letter to the shareholders, expressing concerns over the company's declining performance due to poor leadership by CEO Bob Jordan and Executive Chairman Gary Kelly. Elliott criticized the management's entrenchment tactics and emphasized the need for a transparent and credible process to reinvigorate the company.
• On September 10, 2024, Elliott Investment Management praised the Board for resigning seven directors, noting it as unprecedented. They emphasized the need for further changes and expressed confidence in their nominees to guide the airline forward. Source
• On September 24, 2024, Elliott Investment Management (10.2%) sent a second open letter to the shareholders, announcing their intent to call a special meeting in the coming weeks due to the urgent need for leadership change. They accused Southwest of obstructing this change through defensive actions, including setting "false record dates" to disenfranchise shareholders. Elliott urges shareholders to ensure their voting rights by recalling any loaned shares before Southwest's next record date on October 7.
• On September 26, 2024, Elliott Investment Management criticized Southwest Airlines during its Investor Day, stating that CEO Bob Jordan has failed to deliver acceptable financial results and is unfit to lead the company’s proposed changes. They highlighted past promises of profitability enhancements that resulted in deterioration, questioning the board's support for Jordan. Elliott expressed determination to call a special meeting for shareholders to advocate for an independent board capable of improving the company's performance.
• On October 14, 2024, Elliott Investment Management, holding approximately 11% of Southwest Airlines Co. (NYSE: LUV), announced its request for a Special Meeting of Shareholders on December 10, 2024. Elliott aims to elect eight independent director nominees and remove eight current directors, emphasizing the urgent need for governance changes at Southwest. Source

Thomist Capital Proposes Strategic Initiatives to Boost Shareholder Value at Peabody Energy Corporation (BTU)

Key Summary: On August 20, 2024, Thomist Capital (9.96%) proposed strategies to enhance shareholder value, including a share buyback using $1.45B in cash, unlocking value in the Powder River Basin asset, and selling a stake in Centurion.

Market Cap: $3.2 billion | Peabody Energy Corporation engages in coal mining business in the United States, Japan, Taiwan, Australia, India, Brazil, Belgium, Chile, France, Indonesia, China, Vietnam, South Korea, Germany, and internationally. 

• On August 20, 2024, Thomist Capital (9.96%) suggested various strategies to the management to enhance shareholder value, including a share buyback plan utilizing the $1.45B cash on hand, unlocking value in the company's Powder River Basin asset, and selling a stake in Centurion to free up cash flow for shareholder returns and establish a strong asset valuation. They plan to discuss these ideas with the management and potentially engage with the Board, shareholders, analysts, strategic partners, and other relevant parties. Source
• On September 24, 2024, Thomist Capital reiterated their suggestions and stated that they intend to continue evaluating their investment, which may lead to acquiring or disposing of shares based on various factors, including the company's financial performance and market conditions. Source
• On October 16, 2024, Thomist Capital (5.1%) reiterated their suggestions and announced their intention to maintain a constructive dialogue with the company regarding potential opportunities. Source

Murchinson Criticizes AGM Delay and Plans Governance Proposals for Nano Dimension (NNDM)

Key Summary: On August 14, 2024, Mr. Kellner announced plans to nominate himself, Mr. Deutsch, and Mr. Chioini for the 2024 board elections. On September 3, he formally submitted this notice and indicated an additional nominee would be added. On September 11, he updated the notice to include Mr. Sweeney as a nominee.

Market Cap: $16 million | AIM ImmunoTech Inc., an immuno-pharma company, focuses on the research and development of therapeutics to treat multiple types of cancers, viral diseases, and immune-deficiency disorders in the United States. 

• On August 7, 2023, Ted D. Kellner (who, together with Todd Deutsch, owns 6.5%) stated that he had delivered a notice to the Company regarding his intent to nominate himself, Mr. Chioini, and Mr. Deutsch for election to the board at the 2023 AGM. Source
• On August 23, 2023, the Company rejected Mr. Kellner's Notice. On August 25, Mr. Kellner sued in the Delaware Court of Chancery seeking declarations that the bylaw amendments are unlawful and accuses directors of breaching fiduciary duties. He requested a quick trial before the 2023 Annual Meeting. Source
• On October 13, 2023, Ted D. Kellner filed proxy materials seeking support for his nominees. Source
• On November 1, 2023, Ted D. Kellner filed proxy materials seeking support for his nominees.
• On December 28, 2023, the Delaware Court of Chancery invalidated four advance notice bylaw provisions that had been adopted by the Board in March 2023, favoring Mr. Kellner. However, the Court found that Mr. Kellner's notice of nominations did not comply with some of the Company's remaining advance notice provisions. Mr. Kellner disagreed with the Court's opinion on this matter and pursued an expedited appeal while seeking to halt the Company's Annual Meeting during the appeal. AIM had announced that it would disregard Kellner Group's nominations, but stockholders still had the option to "withhold" votes for incumbent directors. Mr. Kellner had intended to pursue his appeal and seek relief for a stockholder vote on Kellner Group nominees, even if the Annual Meeting proceeded as scheduled.
• At the AGM held on January 5, 2024, shareholders have elected all four of the Company’s directors.  But two directors received more than 40% withheld votes. Source
• On August 14, 2024, Mr. Kellner stated that he intends to submit a notice to nominate himself, Mr. Deutsch, and Mr. Chioini for election to the Company’s board of directors at the 2024 annual meeting of stockholders well ahead of the September 13, 2024 deadline. Source
• On September 3, 2024, Mr. Kellner submitted to the Company notice of his intent to nominate himself, Mr. Deutsch and Mr. Chioini for election to the board at the 2024 AGM. Mr. Kellner also notified the Company that he would supplement the Notice no later than September 13, 2024 to identify an additional highly qualified and independent nominee. Source
• On September 11, 2024, Mr. Kellner updated his previous notice to the Company, adding Mr. Sweeney as a nominee alongside himself, Mr. Deutsch, and Mr. Chioini for election to the board of directors at the 2024 Annual Meeting of stockholders. Source
• On October 18, 2024, Mr. Kellner filed proxy materials seeking support for his nominees.

Past

In July 2022, Jonathan Jorgl and his nominees, Robert L. Chioini and Michael Rice, collectively known as the AIM Stockholder Full Value Committee, notified AIM ImmunoTech Inc of their intention to nominate Chioini and Rice for the company's board, aiming to replace Directors William Mitchell and Stewart Appelrouth. The committee reiterated its commitment to this cause in August, and later, in September, filed proxy materials seeking support for their nominees. Disagreements arose as AIM considered the nomination notice invalid due to non-compliance with the company's bylaws. Jorgl sued AIM in Delaware's Chancery Court seeking validation of the nomination. In October, AIM's claims against the committee were dismissed, and the committee continued to voice its concerns, especially after discovering alarming statements made by incumbent directors during the ongoing legal proceedings. In November, the Chancery Court denied Jorgl's plea for a preliminary injunction. Although the committee disagreed with this decision, they opted against proceeding with a trial or seeking an appeal. Finally, at the AGM held on November 3, 2022, all three company's director nominees were elected to the Board.