The European Commission believes that Adobe’s proposed acquisition of Figma will reduce competition from interactive product design software. The companies have until February to make concessions.
The European Commission states that Figma is the market leader and Adobe is one of its biggest competitors. The takeover would combine market positions, creating an overly dominant player. The Commission says that the acquisition will also result in the discontinuation of Adobe XD. Adobe’s own product design tool is now no longer available via Creative Cloud. The phasing out would result in a reverse killer acquisition, the Commission warns.
The acquisition would also eliminate Figma as a potential competitor when it comes to providing vector and raster editing software. According to the EC, this would strengthen the dominance of Adobe, which is the market leader in this area through software such as Illustrator and Photoshop, in these markets. The Commission states that there is a good chance that Figma will enter these markets if the takeover does not go ahead. As a result, Figma can grow into a major competitive factor for Adobe.
Adobe and Figma will have the opportunity to respond in writing to the objections and make concessions to address the Commission’s concerns. Adobe and Figma say to Bloomberg have no plans to compete with each other in product design. The companies also say they have confidence in addressing the regulator’s concerns.
In August, the European Commission announced it was investigating Adobe’s alleged takeover of Figma. Also the United Kingdom and the United States are examining the takeover. Adobe is willing to pay $20 billion for Figma.