On December 18, 2023, Adobe Inc. and Figma, Inc. announced jointly that they would abandon the proposed merger between the two companies. The companies first entered into a merger agreement on September 15, 2022; but after fifteen months of negotiations with EU and UK regulators, they issued a statement saying that, although they “strongly disagree with the recent regulatory findings,” they see “no clear path to receive necessary regulatory approvals.”
Adobe is a global software company providing creative and interactive design tools. It is a US company based in San Jose and San Francisco, California. Figma, also based in California, provides a web-based collaborative tool for interactive product design, among others. In the United Kingdom, the Competition and Mergers Authority launched a merger inquiry in May 2023 and issued a decision to refer the matter for a Phase 2 investigation in July. In late November 2023, the CMA issued a provisional findings report and press notice, concluding that Adobe’s deal to buy Figma would likely harm innovation for software used by the vast majority of UK digital designers. Similarly, the European Commission opened an in-depth investigation in August 2023, two months after the transaction was notified to the Commission in June 2023, having been referred by sixteen countries pursuant to Article 22 of the EU Merger Regulation. Upon opening the in-depth investigation, the Commission informed the parties that the proposed acquisition could reduce competition in the global markets for the supply of interactive product and creative design software. In late November 2023, the CMA issued a provisional findings report and press notice, concluding that Adobe’s deal to buy Figma would likely harm innovation for software used by the vast majority of UK digital designers. Similarly, the European Commission opened an in-depth investigation in August 2023, two months after the transaction was notified to the Commission in June 2023, having been referred by sixteen countries pursuant to Article 22 of the EU Merger Regulation. Upon opening the in-depth investigation, the Commission informed the parties that the proposed acquisition could reduce competition in the global markets for the supply of interactive product and creative design software. In late November 2023, the Commission issued a statement of objections, offering Adobe and Figma the opportunity to reply to each objection and to comment on the finding that the transaction may significantly reduce competition in the global markets for several product types.
As previously agreed, Adobe will pay Figma a termination fee to resolve the final outstanding matters from the transaction.
CMA report (parties’ responses) | Adobe press release | Figma press release