The supposed $20 billion merger of Adobe and Figma is now canceled, with both companies mutually dropping their agreements, ending what was supposed to be one of the largest acquisitions of the renowned software company. This was amidst the massive presence of the regulators in its deal, particularly facing pressure from the United Kingdom and Europe.
Both companies did not want this merger to end, particularly as both are set to join hands in the future of product design platforms, but massive implications may be on the way.
Adobe, Figma Drops $20 Billion Merger
Adobe and Figma announced that one of the largest mergers in the world of design has come to an end, with both parties choosing to drop the $20 billion merger today.
Although both companies continue to believe in the merits and procompetitive benefits of the combination, Adobe and Figma mutually agreed to terminate the transaction based on a joint assessment that there is no clear path to receiving necessary regulatory approvals from the European Commission and the UK Competition and Markets Authority.
Shantanu Narayen, Adobe CEO, and chair, claimed that it is in the best interests of both companies to "move forward independently."
Regulatory Pressure From EU, UK
They revealed that there was regulatory pressure from the European Commission, as well as the United Kingdom's Competition and Markets Authority, a.k.a. the CMA. It is known that Adobe recently rejected CMA's conditions to approve the merger on their end.
Moreover, based on their SEC filing of the merger agreement, Adobe is set to pay Figma $1 billion in cash as part of the termination deal between both companies.
Adobe and its Ventures
Adobe is one of the biggest names in the design industry, and it has cemented its place in the many decades before, as one of the most trusted services available in the world. One of the most recent developments of the company is with its generative AI ventures known as the Firefly, with the technology integrated among Adobe apps to help create better designs and outputs for all.
Not only does it help in editing images, videos, vectors, 3D designs, and others, but its Firefly AI also helps deliver new creations from its text-to-image prompt features available now.
Part of the Big Tech of the world, news of Adobe's massive acquisition of the design company, Figma, also turned the heads of US regulators, asking for more information about this merger.
More than a year later, the supposed merger of two US-based renowned design companies has come to an end, with Adobe and Figma parting ways because of the mounting pressure from global regulators. The UK and EU's investigation into their merger led to both terminating their agreements, with Adobe left to pay a $1 billion termination fee in cash, as stated in their contracts.
