Adobe's Figma buy isn't going to happen, and will cost Adobe $1 billion
Amber NeelyAdobe
Adobe has dropped its $20 billion acquisition of Figma after expressing concerns that there was "no clear path" to do so because of regulatory concerns.
On Monday, Adobe and Figma announced they would mutually terminate their merger agreement following increased pressure from E.U. and U.K. regulators.
"Although both companies continue to believe in the merits and procompetitive benefits of the combination, Adobe and Figma mutually agreed to terminate the transaction based on a joint assessment that there is no clear path to receive necessary regulatory approvals from the European Commission and the U.K. Competition and Markets Authority," Adobe said in a statement.
The statement notes that Adobe and Figma disagree with the regulatory findings but have decided to part ways regardless.
The Verge notes Adobe will be required to pay Figma a reverse termination fee of $1 billion, which has been previously agreed upon by both parties.
In September 2022, Adobe announced that it had begun the process of acquiring X.D. rival Figma for $20 billion. The deal would have involved both a mix of cash and stock consideration.
However, in February 2023, E.U. regulators blocked the acquisition over concerns that it would decrease competition within the design software market. It was learned at the same time that the U.S. DOJ had been investigating the deal in November 2022.
The Figma deal is not Adobe's only brush with regulators in recent days. The design software company could face hefty fines related to its overly difficult and costly subscription cancellation practices. In December 2023, Adobe told investors it has been cooperating with FTC staff on the matter since June 2022.
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6 Comments
Figma along with Affinity is giving Adobe some competition, (note: these two companies have out out of left field in recent times to challenge Adobe god knows Quark isn't).
Elmo could have gotten away with a $1B loss, but he chose a $44B loss, because he's a jeeneeus biznizman.
Remember when UX was the hot new job for about ten months. Those jobs dried up and the UX designers who have jobs, hate them. A quick search shows adobe job postings containing "UX" are all based out of India. This was the weirdest, shortest tech trend I've ever witnessed and Adobe got caught up in the hype. Good thing they can pull out for 1 billion instead of 20
Dang.