Adobe walks away from $20 billion acquisition of Figma

Earlier today, Adobe and Figma announced that both companies are mutually terminating their merger agreement, which would have seen leading multimedia software company Adobe acquire the Figma product design platform for $20 billion.

The decision to end the acquisition follows mounting pressures from UK and EU regulators, who cited concerns about Adobe attaining a monopoly status in the design software market. 

In September 2022, Adobe announced that it would acquire Figma, a fast-growing product design platform now more popular than Adobe’s rival XD application. In response to the announcement regulators and designers expressed concerns that the merger would stifle innovation in the design space. 

“Adobe and Figma strongly disagree with the recent regulatory findings, but we believe it is in our respective best interests to move forward independently,” said Adobe chair and CEO Shantanu Narayen in a statement by the company. “While Adobe and Figma shared a vision to jointly redefine the future of creativity and productivity, we continue to be well positioned to capitalize on our massive market opportunity and mission to change the world through personalized digital experiences.”

As a result of the termination, Adobe will be required to pay Figma a reverse termination fee of $1 billion in cash.

“It’s not the outcome we had hoped for,” said Figma CEO Dylan Field in a statement. “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.”