After failing to convince the relevant regulators, Adobe and Figma are dropping the $20 billion merger deal they announced earlier, both companies revealed today.
The roadblocks came in the form of market competition acts from the UK and EU, which disallowed the merger deal, citing possible law violations. Though Adobe and Figma tried to convince them, it didn’t work out, leading to Adobe dropping the agreement and paying a $1 billion withdrawal penalty to Figma.
Adobe Cancels Figma Deal
What’s supposed to become a grand merger in the design industry has now fallen apart due to regulatory pushback. The Adobe-Figma acquisition was touted as the next big thing after Microsoft-Blizzard’s this year. But, it was dropped after Adobe failing to convince the global regulators of the deal’s legality.
Regulators in the UK, EU and the US have been investigating possible law violations of the Adobe-Figma deal, since their announcement in mid-September and finally decided to keep them apart for good.
Both Adobe and Figma have today announced dropping the $20 billion deal, citing “no clear path to receive necessary regulatory approvals from the European Commission and the UK Competition and Markets Authority“.
Announcing this decision, Adobe CEO Shantanu Narayen said, “Adobe and Figma strongly disagree with the recent regulatory findings, but we believe it is in our respective best interests to move forward independently“.
Moving forward, Adobe and Figma will continue as independent companies, and signed the termination agreement to settle all the outstanding matters, including Adobe paying Figma $1 billion as a withdrawal penalty.
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