iNDICA NEWS BUREAU-
Software major Adobe has terminated its bid to buy its rival Figma for $20 billion after hitting regulatory roadblocks in the EU and the UK. The companies had announced on September 15, 2022, that Adobe will acquire Figma for a mix of cash and stock consideration.
Recently the companies announced that they have mutually agreed to terminate their previously announced merger agreement. The termination of the transaction was based on a joint assessment that there is no clear path to receive regulatory approvals from the European Commission and the UK Competition and Markets Authority, the companies said in a statement. The companies have signed a termination agreement that resolves all outstanding matters of the transaction. Adobe has also paid Figma $1 billion termination fee.
“Adobe and Figma strongly disagree with the recent regulatory findings, but we believe it is in our respective best interests to move forward independently,” said Shantanu Narayen, chair and CEO, Adobe. “While Adobe and Figma shared a vision to jointly redefine the future of creativity and productivity, we continue to be well positioned to capitalize on our massive market opportunity and mission to change the world through personalized digital experiences.”
When the companies announced their merger plans in September last year, the deal attracted regulatory scrutiny due to the size of the transaction. The European Union opened an in-depth antitrust investigation in August this year into Adobe’s bid to acquire product design platform Figma for $20 billion, saying that the transaction may reduce competition in the global markets for the supply of interactive product design software and digital asset creation tools.
The UK’s competition watchdog also found that the acquisition could reduce innovation and result in a “substantial lessening of competition”.
“Going through this process with Shantanu, David and the Adobe team has only reinforced my belief in the merits of this deal, but it’s become increasingly clear over the past few months that regulators don’t see things the same way,” said Dylan Field, co-founder and CEO, Figma. “While we’re disappointed in the outcome, I am deeply grateful to everyone who has contributed to this effort and excited to find other ways to innovate on behalf of our respective communities with Adobe.”
