Adobe’s purchase for over $200 billion

Adobe’s purchase for over $200 billion

Adobe’s acquisition of software company Figma for about $20 billion will not go ahead, according to a press release from the two companies on Monday.

The termination takes place 15 months after the agreement, which included a 50/50 cash/shares settlement, was first announced in September last year, and comes after negative reactions from regulatory authorities in both the EU and the UK.

The UK Competition and Markets Authority (CMA) believes that a merger of the two companies would have threatened competition in product design, photo editing and illustration. Adobe has refused to find a solution that would satisfy concerns raised by the CMA last week, arguing that a spin-off would be “grossly disproportionate”.

– Strongly Disagree

Adobe and Figma strongly disagree with the regulatory authorities’ conclusion, but we find it in our best interests to move forward individually, says Adobe Chairman and CEO Shantanu Narain in a statement.

The parties wrote in a letter on Monday that they no longer “see a clear path” toward obtaining the necessary regulatory approvals.

The competition authorities’ rejection represents a setback for Narain, who is participating CNBC At the latest on Wednesday of last week, he spoke warmly about the acquisition and the benefits to customers.

– We want to take what Figma did with creative collaboration software on the web, combine it with what we’ve done, and make it more accessible to others. “We believe our fields are adjacent, we really believe that, but the regulatory climate is challenging,” he said.

“Separation fees”

Now it has become clear that the acquisition, which would have been the largest ever by a privately owned software company, has gone unheeded. Adobe will pay Figma a $1 billion “break-up fee,” according to a letter sent to the US Financial Regulatory Commission (SEC).

See also  “Very, very afraid” - Itavesen

Figma allows customers to collaborate on software as they build it, and they have seen an increase in demand during the pandemic with more people working from home. In recent years, the company has expanded its client base from software designers at large companies like Airbnb, Google, Herman Miller, and Kimberly-Clark to also include individuals developing games, maps, and smaller presentations.

Adobe shares rose 1.4 percent in pre-Wall Street trading on Monday.

Hanisi Anenih

Hanisi Anenih

"Web specialist. Lifelong zombie maven. Coffee ninja. Hipster-friendly analyst."

Leave a Reply

Your email address will not be published. Required fields are marked *