Adobe’s $20 Billion Figma Takeover Hit by In-Depth EU Probe | Tech News

Adobe’s $20 Billion Figma Takeover Hit by In-Depth EU Probe

Adobe Inc.’s $20 billion takeover of Figma Inc. is set for an in-depth European Union investigation over concerns the deal could harm global competition for software used by designers.

By:BLOOMBERG
| Updated on: Aug 08 2023, 06:42 IST
The planned deal will give San Jose-based Adobe control of the world-leading web design platform Figma,
The planned deal will give San Jose-based Adobe control of the world-leading web design platform Figma, (REUTERS)

Adobe Inc.'s $20 billion takeover of Figma Inc. is set for an in-depth European Union investigation over concerns the deal could harm global competition for software used by designers.

The European Commission warned on Monday the transaction could undermine the supply of tools for interactive product design as well as digital asset creation and that an “important competitive force” could be removed.

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The EU's in-depth probe, set to run until Dec. 14, will also analyze “whether the transaction may foreclose rival providers” by “bundling Figma with Adobe's Creative Cloud suite.”

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“We aim to ensure that users continue to have access to a wide pool of digital creative tools among which to choose,” Margrethe Vestager, the EU's antitrust commissioner, said in a statement.

‘Transformational'

The planned deal will give San Jose-based Adobe control of world-leading web design platform Figma, in a move described by Adobe Chief Executive Officer Shantanu Narayen as “transformational.”

The purchase is seen as a massive bet that more creative work will be done by small businesses and everyday users on the web, a market that Figma has rapidly seized. While Adobe has introduced less-expensive, streamlined products for that audience, most of its offerings are still heavyweight programs aimed at specialists.

Adobe also faces scrutiny further afield. The deal is already being vetted by the UK's competition watchdog and the US Department of Justice.

The company said Monday that it remains “confident in the merits of the case as Figma's product design is an adjacency to Adobe's core creative products” and that it “has no meaningful plans to compete in the product design space.”

“We look forward to establishing these facts in the next phase of the process and successfully completing the transaction,” the company added.

Adobe was little changed at $526.61 at 12:04 p.m. in New York while the Russell 3000 Index Computer Services Subsector advanced.

Phase 2 probes in the EU add about 90 working days to deal reviews. Brussels-based regulators typically demand remedies to solve competition concerns but sometimes also decide to give their unconditional approval if initial concerns are shown to be unfounded.

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First Published Date: 08 Aug, 06:41 IST
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