Adobe and Figma Terminate $20 Billion Partnership Deal

Adobe terminated its $20 billion cash-and-stock deal for cloud-based designer platform Figma, pointing to “no clear path” for approvals from antitrust regulators in the European Union and the UK.

Fifteen months into the regulatory review process, Figma and Adobe no longer see a path toward regulatory approval of our proposed acquisition.

The deal, which was announced in September last year, was the latest to draw tough scrutiny from regulators worried over Big Tech acquisitions that boost dominant company’s market power or involve startups seen as nascent rivals.

What do Adobe and Figma have to say about this?

Figma and Adobe have reached a joint decision to end their pending acquisition. It’s not the outcome both had hoped for, but despite thousands of hours spent with regulators around the world detailing differences between the businesses, products, and markets they serve, they no longer see a path toward regulatory approval of the deal.

Adobe had argued it does not compete with Figma in any meaningful way. Adobe will pay Figma a $1 billion breakup fee, Adobe said in a regulatory filing.

It had said in November its only product relevant to the antitrust question was the Adobe XD design tool, which lost $25 million as a standalone app over the last three years and has only five full-time employees.

Shantanu Narayen CEO of Adobe

“Adobe and Figma strongly disagree with the recent regulatory findings, but we believe it is in our respective best interests to move forward independently,” Shantanu Narayen, CEO of Adobe, wrote in a statement.

“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.”

Adobe first announced it would acquire Figma in September 2020 in a cash-and-stock deal worth about $20 billion.

The news sent Adobe shares plunging, but the company reiterated that the acquisition would be a natural complement to Adobe’s portfolio, writing in the original announcement that “the combination of Adobe and Figma will usher in a new era of collaborative creativity.”

adobe figma

In Monday’s joint statement, Figma CEO Dylan Field wrote that “going through this process with Shantanu, David and the Adobe team has only reinforced my belief in the merits of this deal, but it’s become increasingly clear over the past few months that regulators don’t see things the same way.”

“We will continue to look for ways to partner with Figma to delight our joint customers,” David Wadhwani, a senior vice president at Adobe, wrote in a separate blog post.





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