Southwest, Activist Elliott Said to Begin Settlement Talks (1)

Elliott Investment Management and Southwest Airlines Co. have begun discussing a potential settlement that would avoid a proxy fight for control of the airline’s board, according to people familiar with the matter.

Elliott has proposed a framework that would give it representation on Southwest’s board but not control, said some of the people, who asked to not be identified because the discussions aren’t public. The talks, which were progressing toward a resolution as of Saturday, haven’t been finalized and could fall through, the people said.

Representatives for Southwest and Elliott declined to comment.

Elliott has nominated eight directors to the ...