The proposed purchase of Figma, an online design company, for $20 billion by Adobe has been cancelled due to opposition from Europe regarding antitrust issues. Both companies announced this on Monday.

In September 2022, the companies revealed a deal involving a combination of cash and stock. The goal is to utilize Figma’s web-based and multi-player features to expedite the implementation of Adobe’s creative cloud technologies on the web.

“Despite their shared belief in the positive aspects and competitive advantages of the merger, Adobe and Figma have mutually decided to end the deal due to a joint evaluation that obtaining regulatory approvals from the European Commission and UK Competition and Markets Authority is not feasible,” stated Adobe and Figma in a prepared announcement on Monday.

On Monday, the European Commission announced that it had been made aware of the decision to terminate the agreement. As a result, their investigation into the proposed transaction has concluded.

American businesses have frequently encountered obstacles in Europe due to similar worries about monopolies.

Illumina, a leading biotechnology company, announced on Sunday that it will reverse its acquisition of cancer-screening firm Grail for $7.1 billion due to legal defeats in antitrust cases in the United States and Europe. In a similar scenario, authorities in Europe recently expressed concerns that Amazon’s planned purchase of iRobot, a robot vacuum manufacturer, could potentially limit competition.

Microsoft finalized its acquisition of Activision Blizzard, a video game company, in October for a total of $69 billion. The purchase was met with opposition from antitrust regulators in both Europe and the United States.

The Markets Authority recently reported that a preliminary examination of a possible merger between the two businesses indicated a significant decrease in competition in the worldwide market for professional product design software and editing software.

Figma, established in 2012, enables individuals designing mobile and web applications to work together using multi-player workflows, advanced design systems, and a developer community.

Adobe, headquartered in San Jose, California, offers software for the creation, publication, and promotion of content, as well as document management.

According to a statement by David Wadhwani, the President of Adobe’s Digital Media Business, the software company plans to seek out opportunities for collaboration with Figma going forward.

The corporations have announced that they reached a mutual agreement to settle all unresolved issues related to the deal. Adobe Inc. has agreed to pay Figma a termination fee of $1 billion, as per their previous agreement.

Adobe’s stock saw a small increase in the morning session.

Source: wral.com