Adobe’s Figma purchase is not going to happen, and it will cost Adobe $1 billion.
Adobe abandoned its $20 billion acquisition of Figma after raising concerns that there was “no clear path” to get there due to regulatory issues.
Adobe and Figma announced on Monday that they would jointly terminate their merger agreement after increasing pressure from the EU. and Great Britain Regulatory authorities.
“While both companies believe in the merits and competitive advantages of the combination, Adobe and Figma have jointly agreed to complete the transaction based on a joint assessment of the necessary regulatory approvals from the European Commission and UK competition.” There is no clear path.and market regulators,” Adobe said in a statement.
The account said Adobe and Figma disagreed with regulators’ findings but had decided to part ways.
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The Verge notes that Adobe will have to pay Figma a $1 billion reverse termination fee, which both parties had previously agreed to.
In September 2022, Adobe announced that it had begun the acquisition of XD. Its rival Figma is worth $20 billion. The transaction will involve payment in cash and shares.
However, in February 2023, EU regulators blocked the acquisition over fears it would harm competition in the design software market. At the same time, it was reported that the USDOJ would review the transaction in November 2022.
The Figma deal is not the only current conflict between Adobe and regulators. A design software company could face hefty fines for its complex and expensive abase practices. In December 2023, Adobe told investors that it had been working with FTC officials on the matter since June 2022.