In light of the recent EU warning, Adobe’s $20 billion acquisition of Figma is now in peril.
Adobe, one of the most prominent software companies in the world, has been in the midst of trying to purchase Figma, a web-based design and collaboration platform, for the hefty sum of $20 billion. The deal was extremely close to being finalized, with both companies having already agreed to it months ago. However, just before it could be finished, the European Commission (EC) issued a statement warning of potential antitrust issues that could arise if the two companies were to merge.
The EC is concerned about Figma’s role in the software industry as Adobe is already one of the largest players in the field. With Adobe having a close hold on the software industry, they would be in a dominant position if one added Figma to their portfolio. This could potentially threaten a fair competitive environment in the industry, as well as create a monopoly in the software business.
It remains to be seen what will happen with the proposed deal. It is possible that the EC could allow the acquisition to proceed if Adobe makes certain concessions that allay these antitrust concerns. It is also possible that the deal could be abandoned altogether, leading to a restructuring of the deal or a complete cancellation.
It is certainly a difficult situation for both companies. Adobe, one of the most successful software companies in the world, would like to have the opportunity to acquire such a prominent company, but they must also act in accordance with the law. Similarly, Figma must decide whether the terms offered by Adobe are worth the chance of potentially crippling antitrust scrutiny from the EC.
The outcome of this situation will certainly be an interesting one, with far-reaching implications for the software industry. For now, we can only wait and see what the EC has in store for Adobe and Figma.