It’s been a little over a year since Adobe announced its intention to acquire Figma, a popular product design tool with collaborative features. We put 20 billion dollars on the table. This operation would rank ninth in the list of the most expensive acquisitions in technology history, after WhatsApp, which was acquired by Facebook.

Ultimately, this won’t happen. Adobe stated on its website: Agreed with Figma to suspend negotiations. Not out of tactical conviction, but for a reason directly pointed out: Regulators’ demands.

Regulators are concerned about innovation in this market

The European Union and the United Kingdom, in particular, have put intense pressure in recent months to prevent a move that would restrict innovation in the sector. Adobe is the market leader in software for designers, but Figma has grown a lot in recent years More popular than Adobe’s alternative, XD.

Regulators were concerned that the innovation Figma would bring to the industry with its acquisition would be limited. Some professional designers have expressed similar concerns in recent months.

It’s only been a few days since Adobe rejected contract changes requested by the UK antitrust agency. This stated that If this operation continues, the product design software market will suffer.Adobe is blocking it until it accepts some adjustments. They were rejected and Adobe announced its disagreement with this regulator.

The European Commission had a very similar view and had been conducting an investigation since last August. The United States Department of Justice, the equivalent of our Department of Justice, also had plans similar to those reported. Bloomberg At the beginning of the year.

All this pressure discouraged Adobe from continuing to fight for this acquisition. “This was not the result we expected,” Figma CEO Dylan Field said in a statement released by his company. “But despite the thousands of hours we have spent with regulators around the world detailing the differences between our businesses, our products and the markets we serve, we no longer see a way for the agreement to be approved by regulators.”

European Commissioner for Competition Margrethe Vestager commented on this agreement in a public statement on the European Commission’s website; including this quote, notice to sailors:

In digital markets as well as in more traditional industries, it is important not only to observe current overlaps but also to protect future competition. This is especially true in transactions where large established companies acquire successful business innovators. We note Adobe and Figma’s decision to back out of the deal.

According to the statement, Adobe will now have to pay 1 billion dollars in compensation to Figma due to the cancellation of the operation. Border Link to original SEC filing.

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Featured image | Shubham Dhage on UnsplashXataka.