Adobe won’t find it easy to finalize the purchase of Figma for $20 billion. The European Union, committed to maintaining a healthy market economy free from monopoly risks, has presented Adobe with a list of objections that it must address if it wants the EU’s approval.
This isn’t a surprise as Europe first expressed concerns about this acquisition last summer, firmly establishing its stance on safeguarding the market against potential monopolistic practices. Therefore, Adobe will be compelled to consider the European conditions if it intends to continue operating its products and services in the countries that make up the European Union.
A controversial purchase for Europe
Since August 7th, the European Union has been observing Adobe’s purchase of Figma with concern, as they believe it “drastically reduces competition,” significantly escalating the risk of a monopoly in an already limited-competitor sector. That’s why the solidified list of objections must be reviewed by Adobe and Figma, and responses need to be provided by February 5th.
Both Adobe and Figma will have these months to assess the objections outlined by the European Union and explicitly argue why these objections might be unfounded. This is a long legal battle, and these actions can extend for years if they end up going to court, similar to the recent Microsoft purchase of Activision to expand the Xbox ecosystem, a deal that took two years to finalize.
Figma, the competition aiming to absorb Adobe
Figma, a vector editing platform, offers a very useful and valued service as an alternative to Adobe Illustrator. However, if Adobe’s acquisition for $20 billion goes through, everything would remain within the same house. Yet, considering it’s an acquisition within the competition itself, it’s entirely natural for Europe to activate anti-monopoly mechanisms.
Adobe has been on computers around the world for decades. With multiple services surrounding it and iconic applications like Illustrator, Photoshop, Premiere, or Audition, among others, the digital work sector largely evolved due to the existence of these types of tools.