Adobe cancel $20B plan acquisition of Figma

Adobe cancel $20B plan acquisition of Figma

Adobe's $20 billion mega-bid to buy rival Figma has been officially put on hold after the companies said today that regulatory pushback in Europe had made them cancel the plans.

Adobe and Figma still believe in the merger's procompetitive benefits, according to a press release. Both parties discontinued the arrangement because they believed the European Commission and U.K. Competition and Markets Authority clearances were unclear.

Last September, the deal was announced. Because it was so enormous and eliminated Adobe's most prominent opponent, regulators would always watch it. The DOJ had monitored the agreement for most of 2023 but had not yet sued to block it. Before the weekend, Adobe and Figma were meeting with the DOJ to avoid legal action.

In Europe, the two corporations were already struggling regardless of the decision. After the EU declared a similar course of action in August, the U.K. concluded in late November that the proposed acquisition would “harm innovation” and initiate an in-depth probe.

Related Post:  Egyptian real estate innovator Nawy raises $52 million to expand across MENA
Read also: HUGO BOSS And Adobe Partner To Drive 3D Innovation In Fashion

Effective rival

Despite their differences, Figma was the “clear market leader” for interactive product design tools and a “constraining influence” over Adobe in the digital asset creation tools space, so Adobe buying Figma would prevent Figma from being an “effective competitor.”

In a blog post, Figma CEO and co-founder Dylan Field claimed they made the “joint decision” after trying to convince regulators of their product and business differences.

After spending thousands of hours with regulators worldwide describing how our businesses, products, and markets differ, Field said, "We no longer see a path towards regulatory approval of the deal."

Related Post:  European DFIs support BluePeak with $80 million to empower African SMEs

After everything, Adobe must pay Figma $1 billion to terminate. This was due if the merger didn't gain regulatory permission or close within 18 months of last September's purchase announcement.

https://techpressionmedia.com/mastercard-and-meta-partner-with-adobe/

No regulatory organisation had released their final results within the 18-month deadline. Adobe and Figma couldn't see a way out, and with the DOJ mulling regulatory action, it made more sense to cancel the agreement.

Toby Smith, a former CMA legal director and Geradin Partners partner in London, told reporters, "It is not uncommon to back out of a deal right before the final decision when a ban seems inevitable." 

The merging parties won't make a wrong choice that sets a bad example. It saves on legal fees, although that may not matter on such a momentous day.

Modupeoluwa Olalere

Modupeoluwa Olalere, a tech enthusiast with 4+ years of experience simplifying tech stories and making complex ideas easy to understand.

Next Post

TikTok eliminates 1.4 million Nigerian videos in Q3 2023.

Fri Dec 22 , 2023
       On TikTok, Bytedance's short video platform, 1.4 million videos shared by Nigerian users were taken down in the third quarter […]
TikTok eliminates 1.4 million Nigerian videos in Q3 2023.

Related Posts

Quick Links

Select Language

Click the Arrow beside your current Language below to Select a New one.


This will close in 10 seconds

techpression.com
Privacy Overview

This website uses cookies so that we can provide you with the best user experience possible. Cookie information is stored in your browser and performs functions such as recognising you when you return to our website and helping our team to understand which sections of the website you find most interesting and useful.