NEW YORK >> Elliott Investment Management now holds 10% of Southwest Airlines’ common stock, crossing the threshold that allows the hedge fund to call a special meeting at the carrier, according to a person familiar with the matter.

The news comes days before the two sides are scheduled to meet on Sept. 9 to discuss ways to solve problems that have contributed to Southwest’s stock losing roughly half its value over the last three years.

The hedge fund, one of the world’s most powerful activist investors with $70 billion in assets under management, has demanded that CEO Robert Jordan and Executive Chairman Gary Kelly be ousted. It also laid out plans to nominate 10 directors to the airline’s 15-person board.

The hedge fund, which had taken an 11% economic stake through derivatives, converted enough of those holdings into common shares to cross the 10% threshold. Its overall economic stake remains unchanged.

A Southwest representative was not immediately available for comment.

Jordan, Southwest’s chief executive since 2022, has said he will not resign and has signaled to staff that he and other executives are ready to fight Elliott.

Elliott has signaled to other shareholders that it is ready to take the next steps, including calling a special meeting, unless the company is willing to discuss changes to its leadership.

A special meeting, used to solicit shareholder votes on matters that cannot wait until the next annual gathering, are rare. And if Elliott were to call one it would represent a major escalation of its fight with the carrier since its interest in the stock became public in June.

While the airline has been trying to repair its image and share price, it has also adopted a defensive measure by putting a shareholder rights plan in place which would make it harder for an investor to accumulate more than 12.5% of the stock.

Southwest announced plans to add seats with more legroom, moved to assigned seats and named a new board member in July.

Southwest’s stock price had lost 50% of its market value in the three years to June 7 when it closed at $27.75, just before Elliott’s investment in the airline became known on June 10. It closed trading at $28.92 on Friday. The company’s value has tumbled to $17 billion now from $41 billion in 2017, according to Elliott’s research.

Elliott has said the improvement measures come too late and offer too little.

Elliott has previously pushed for top executives to be removed including NRG CEO Mauricio Gutierrez who insisted that he would stay only to resign late last year. NRG’s stock price has risen roughly 160% since Elliott’s stake was revealed in May 2023.