Adobe has decided not to go ahead with the purchase of Figma, as a result of the growing pressures it had to face from the regulatory authorities of the EU and the United Kingdom to be able to go ahead with the operation. The breakdown of the purchase agreement, announced about a year ago, occurred by mutual agreement, and Adobe, which was going to pay $20 billion for the acquisition, will have to pay Figma $1 billion in cash as compensation.
The regulators soon backed down Adobe’s claims with this operation, since in the cases of the authorities of the two aforementioned regions, they indicated that the merger practically led to a monopoly situation. They were concerned that purchasing Figma, a high-growth product design platform that is already even more popular than its Adobe rival, would hurt the innovation that could occur if Figma remained independent.
Designers were also worried about the same thing, although Adobe denied that anything like that would happen. But he also didn’t want to take steps to ensure it. Shortly after the British regulator announced a few days ago that the company had to implement several measures for the United Kingdom Competition and Markets Authority, the CMA, to authorize the purchase, Adobe has decided not to continue with it.
The measures implied a strong divestment in assets, source code and personnel to «restore conditions of competition«. The affected parties to the operation were scheduled to debate the decision to block the agreement on December 21, to also set a deadline for approving or blocking the operation of February 25.
The agreement was also being reviewed by the European Commission, and apparently in February the United States Department of Justice was going to open a similar investigation, which logically will no longer take place. With pressure mounting to make significant changes to enable the deal, Adobe had very little room to get the deal to move forward the way they wanted to keep all of the Figma assets they wanted.
As mentioned by Adobe CEO and President Shantanu Narayenit’s a statement, “Adobe and Figma strongly disagree with what regulators have recently determined, but we believe it is in our respective interests to move forward independently. While Adobe and Figma share a vision to jointly redefine the future of creativity and productivity, we remain well positioned to capitalize on our immense market opportunity and our mission to change the world through personalized digital experiences.«.
For his part, the CEO and co-founder of Figma, Dylan Fieldhas highlighted that this «It is not the result we expected. But despite thousands of hours spent with regulators around the world detailing the differences between our businesses, our products and the markets we serve, we no longer see a path from regulators to approving the deal.«.