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Adobe’s$20 billion mega - bidto buy rival Figma is nowofficially dead , after the companies said today that regulatory pushback in Europe had caused them to put an end to the acquisition architectural plan .
First announced in September last year , the deal was always lead to pull in regulatory scrutiny due to the size of the dealings and the fact that ittook one of Adobe ’s major rivals out of the picture . The U.S. Department of Justice ( DOJ ) had beenlooking closely at the dealfor the good part of 2023 , though it had yet to file any formal lawsuit to stop the deal from occur — but newsemergedbefore the weekend that Adobe and Figma were meeting with the DOJ in a last - gasp endeavor to fend off effectual action .
no matter of that outcome , the two company were already face substantial headwind in Europe . The U.K. had resolve in previous November that the aim acquisition would “ harm innovation ” and thus its competition sanction would establish an in - depth investigation , following on from a interchangeable consequence in the European Union ( EU ) whichannounced a like course of action in August .
More than a year later , the $ 20B Adobe - Figma pile is still stuck in regulatory limbo
Effective competitor
The crux of the concerns was that while the ship’s company ’ several products were not like - for - corresponding identical , Figma was the “ exonerated market leader ” for interactional mathematical product design pecker , and that it acted as a “ stiffen influence ” over Adobe in the digital asset world prick blank — therefore , Adobe buying Figma would preclude Figma from being an “ effectual competition . ”
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In ablog post today , Figma CEO and co - founder Dylan Field said that they reached the “ joint decision ” after failing to convert regulator of the differences between their respective products and businesses .
“ It ’s not the outcome we had hope for , but despite thousands of 60 minutes spent with regulator around the macrocosm detailing difference of opinion between our businesses , our products , and the food market we serve , we no longer see a path toward regulative approval of the deal , ” Field said .
As a result of all this , Adobewill now have to payFigma a termination fee of $ 1 billion , which was contractually collectable in the event of the transaction failing to attain regulatory clearance — or if it conk out to fill up within 18 month of the acquisition ’s announcement last September .
That 18 - month deadline had n’t yet been reach , and no regulative body had really announce their last findings — but Adobe and Figma clearly see no fashion through this , and with the DOJ also weigh up regulatory action , in the end it just made more sentiency to displume the plug on the deal entirely .
“ It is not unheard of to abandon a deal shortly before the last decision where a prohibition seems inevitable , ” Tom Smith , a former CMA legal theater director who ’s now partner at London - found jurisprudence firm Geradin Partners , explained to TechCrunch . “ This void the merging parties having an untoward decision against them that could serve as a precedent . It also saves some effectual fees , although that may be a more minor consideration in such a huge slew . ”
