Summary
Adobe’s shares rose by 1.8% at the beginning of trading on Monday after the company announced the cancellation of its $20 billion acquisition of Figma due to regulatory issues.
Details
Adobe (ADBE) announced that it plans to terminate its $20 billion acquisition deal of Figma, a leading web-based collaborative design platform, due to regulatory challenges.
Both companies stated in a joint statement: “Adobe and Figma mutually agreed to terminate the deal based on a shared assessment that there is no clear path to obtaining the necessary regulatory approvals from the European Commission and the Competition and Markets Authority in the UK.”
The deal was first announced in September 2022 but has since faced scrutiny from competing regulators. The European Commission stated in November that “Adobe’s proposed acquisition of Figma could reduce competition in global markets for supplying interactive product design software and other creative design software.”
Adobe CEO Shantanu Narayen said: “Adobe and Figma are entirely different in terms of the recent regulatory outcomes, but we believe it is in our mutual best interest to move forward independently.”
Adobe submitted a termination agreement with the Securities and Exchange Commission (SEC), which includes a termination fee of $1 billion to Figma.
Adobe’s shares rose by 1.8% to $595.14 per share around noon Eastern Time on Monday following the news, and are up over 75% since the beginning of the year.
Do you have news tips for Investopedia journalists? Please email us at [email protected]
Leave a Reply