Adobe (Nasdaq:ADBE) and Figma announced today the termination of their merger agreement, valued at $20 billion. The decision comes after a joint assessment revealed challenges in obtaining necessary regulatory approvals from the European Commission and the UK Competition and Markets Authority.
Adobe and Figma, both leaders in the creative design space, expressed their continued belief in the strategic benefits of the merger. However, recent regulatory findings led to a mutual decision to move forward independently.
“Adobe and Figma strongly disagree with the recent regulatory findings, but we believe it is in our respective best interests to move forward independently,” said Shantanu Narayen, Chair and CEO of Adobe. “While Adobe and Figma shared a vision to jointly redefine the future of creativity and productivity, we continue to be well positioned to capitalize on our massive market opportunity and mission to change the world through personalized digital experiences.”
Figma, known for its web-based collaborative design platform used by major companies like Uber, Coinbase, and Zoom Video Communications, will receive a termination fee of $1 billion from Adobe. David Wadhwani, President of Digital Media Business at Adobe, expressed confidence in Figma’s future growth and innovation.
“Figma has built an incredible product design platform, and I am confident in their continued innovation and growth after spending more than a year with their team and community,” said Wadhwani. “I have been impressed with Dylan and his incredible team at Figma and will look for ways to partner to delight joint customers in the future.”
Dylan Field, co-founder and CEO of Figma, acknowledged the disappointment in the outcome but expressed gratitude to everyone involved in the effort. “While we’re disappointed in the outcome, I am deeply grateful to everyone who has contributed to this effort and excited to find other ways to innovate on behalf of our respective communities with Adobe,” said Field.
This move by Adobe to abandon the Figma merger highlights the increasing scrutiny of big tech acquisitions by regulators concerned about market dominance. The termination fee, though significant at $1 billion, signals Adobe’s commitment to navigating the challenges independently.
The European Commission and the UK Competition and Markets Authority had expressed concerns about the potential reduction of competition and innovation in the software used by digital designers. Despite disagreements with regulatory findings, Adobe and Figma have chosen to part ways, emphasizing their commitment to pursuing innovation and growth in their respective paths.
