Adobe's $20 Billion Purchase of Figma Would Harm Innovation, UK Regulator Provisionally Finds -- 2nd Update
28 November 2023 - 11:54PM
Dow Jones News
By Joe Hoppe
The U.K. Competition and Markets Authority said it has
provisionally found Adobe's planned $20 billion acquisition of
collaboration-software company Figma would likely harm innovation
for software used by the vast majority of U.K. digital
designers.
The regulator said Tuesday that, following a detailed Phase 2
investigation, it provisionally found that the deal would eliminate
competition between two main companies in product-design software,
reduce innovation and the development of new competitive products,
and remove Figma as a threat to Adobe's flagship Photoshop and
Illustrator products.
"We are disappointed in the CMA's findings and disagree with the
CMA's perspective on this transaction," an Adobe spokesperson said
to the Wall Street Journal.
"Adobe and Figma will deliver significant value to customers. We
are reviewing the provisional findings and will reengage with the
CMA on the facts and merits of the case."
Figma also told the Wall Street journal it was disappointed by
the CMA's provisional findings and disagrees with the assertion
that Figma competes with Adobe today or has plans to do so in the
future.
"We remain committed to the deal, confident in the facts, and
convinced our proposed combination with Adobe is a win for
consumers and should be approved," a Figma spokesperson said.
The CMA said the deal would eliminate competition between the
two companies in three software markets--product design, image
editing and illustration. It added the U.K.'s digital design sector
is worth nearly 60 billion pounds ($75.76 billion), around 2.7% of
the country's economy, and a market which heavily utilizes Adobe
and Figma software.
"Adobe and Figma are two of the world leading providers of
software for app and web designers and our investigation so far has
found that they are close competitors. This proposed deal,
therefore, has the potential to impact the U.K.'s digital design
industry by reducing choice, innovation and the development of new
competitive products," said Margot Daly, chair of the independent
group that conducted the investigation.
The CMA said it would consult on its findings and listen to
further views before making a final decision. It has invited
responses from interested parties by Dec. 19.
Write to Joe Hoppe at joseph.hoppe@wsj.com
(END) Dow Jones Newswires
November 28, 2023 07:39 ET (12:39 GMT)
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