Adobe and Figma announced on Monday that they will jointly terminate their merger agreement and Adobe will acquire the Figma product design platform for $20 billion, following continued pressure from UK and EU regulators.
After the agreement is terminated, Adobe will need to pay Figma a breakup fee of US$1 billion in cash.
"Adobe and Figma strongly disagree with the recent regulatory findings, but we believe it is in our respective best interests to move forward independently," Adobe Chairman and CEO Shantanu Narayen said in a statement. "Adobe and Figma share a vision to redefine the future of creativity and productivity, and we will continue to leverage the tremendous market opportunity and mission to change the world through personalized digital experiences."
The EU competition regulator previously said in a statement that the deal could significantly reduce competition in the global market for the supply of interactive product design tools and vector and raster editing tools. The regulator will make a final decision on Adobe's merger plan on February 5 next year.