Adobe Abandons $20 Billion Figma Acquisition Over Regulatory Concerns

Adobe and Figma have decided to abandon their planned $20 billion acquisition after determining that obtaining approval from UK and European Union regulators would not be possible. The termination of the deal has been fully resolved, with Adobe agreeing to pay Figma a $1 billion termination fee.

In November, both the UK’s Competition and Markets Authority (CMA) and the European Commission expressed concerns about the impact of the proposed acquisition on competition. The CMA’s provisional findings suggested that the merger would eliminate competition between the two main competitors, leading to the consideration of either blocking the deal entirely or requiring Adobe to sell Figma’s core product, Figma Design, along with Adobe XD.

Earlier, Adobe had stated that it would not offer any potential remedies to the CMA, claiming that no realistic remedy would satisfy the concerns being maintained. The European Commission also warned Adobe that the planned purchase of Figma may reduce competition in global markets for interactive product design software and other creative design software. Adobe had initially indicated that it was willing to offer remedies to appease European regulators, but it seems that this is no longer the case.

Adobe’s chair and CEO, Shantanu Narayen, expressed strong disagreement with the recent regulatory findings, but stated that both companies believe it is in their best interests to move forward independently. He also mentioned that both companies continue to be well positioned to capitalize on their respective market opportunities and mission to change the world through personalized digital experiences.

Furthermore, Adobe anticipated potential opposition from the US Department of Justice, and both companies reportedly met with DOJ officials in an effort to secure approval for their merger.