Adobe Breaks Up With Figma After Plans To Acquire It For $20B
By Mikelle Leow, 19 Dec 2023
Adobe and Figma have called it quits, and they’re back to (potentially) being rivals again. The Photoshop maker has severed its massive US$20 billion acquisition plans with the cloud-based collaboration design platform. Initially announced 15 months ago, the deal faced significant regulatory hurdles in Europe, the UK, and the US, ultimately leading to its cancellation.
Per both accounts, Adobe and Figma made the joint decision to go their own ways and terminate their merger agreement after evaluating the complex regulatory landscape. The aborted deal—one of the largest in software startup history—faced intense scrutiny, particularly from European regulators and the UK’s Competition and Markets Authority (CMA). Concerns were raised about the deal’s potential to diminish competition in the digital design sector.
Adobe, acknowledging the regulatory challenges, noted that there was no clear path to gaining antitrust approvals in Europe and the UK.
As a consequence of this termination, Adobe is set to pay Figma a significant fee of US$1 billion. The company stated that it couldn’t offer any potential remedies to address the CMA’s concerns.
“Through this process, it has been a pleasure to get to know Figma’s employees and their community. We will continue to look for ways to partner with Figma to delight our joint customers,” Adobe addresses in a statement.
The public dissolution of this merger has been met with mixed reactions from the creative community—much of it, frankly, being relief.
“I’ve relied on Adobe for 15+ years. Figma changed everything—its user-centric approach leveled up my work… This is the one time I’m down with an acquisition flopping,” says full-stack creator Taylor Peterson.
Adobe and Figma mutually terminate the acquisition agreement.— Eric Jackson (@Jayriq) December 18, 2023
Designers right now ð pic.twitter.com/X0TAoBnnJQ
Adobe Design Evangelist Howard Pinsky shares a sense of disappointment, having seen the potential for a fruitful collaboration between Adobe and Figma.
“On a personal level, I’m devastated,” notes Pinsky. “I’ve grown to love Figma—as a product and company—over the years, and felt we could have accomplished some incredible things together.”
“It’s not the outcome we had hoped for,” Figma CEO Dylan Field laments. “But despite thousands of hours spent with regulators around the world detailing differences between our businesses, our products, and the markets we serve, we no longer see a path toward regulatory approval of the deal.”
I'm not sure regulators would like that either ð— Dylan Field (@zoink) December 18, 2023
Both companies share optimistic but separate goals for 2024—Adobe, with its forthcoming roadmap surrounding tools like Firefly, Creative Cloud, Express, and Acrobat; and Figma, with its vision to “eliminate the gap between imagination and reality” as the world of artificial intelligence and the digital economy advance day by day.
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