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Over the period from October 2006 to May 2008, Atos Origin, a French information technology company, was the target of two activist hedge funds, Centaurus and Pardus. This article investigates in detail how the activists initiated their actions, how the management organized its defence and how both were received by the market. The analysis reveals that, although Atos seemed to be an attractive opportunity, the funds failed in their primary objective, the sale of the target. In fact, the chairmen of Atos succeeded in discrediting the two hedge funds by getting support in the French context, not particularly prone to and sometimes even hostile towards shareholder's interests. Our findings show that the success/failure classification used in large-sample studies, and based very often on officially stated goals, bears a considerable risk of misinterpretation. The Atos case shows that empirical studies should more heavily rely on what really matters for hedge fund activism, i.e. the sale of the target, spin-offs or cash-outs. While governance related motives are often mentioned and easily enforced, they do not make activism profitable and cannot, by themselves, be considered as primary motives for hedge fund activism. As a consequence, the success of hedge fund activism should be assessed considering primary motives only.
