Sign up now for FREE unlimited access to Reuters.comSign up Sept 15 (Reuters) – Adobe Inc will buy startup Figma for about $20 billion in its biggest deal yet, the Photoshop maker said on Thursday, bringing together apps that support online collaboration amid a global shift to hybrid work. The cash and stock deal will give Adobe ownership of a company whose online collaboration platform for plans and brainstorming is used by companies ranging from Zoom Video Communications ( ZM.O ) to AirBnB and Coinbase ( COIN.O ). “The combination of Adobe and Figma is transformative and will accelerate our vision for collaborative creativity,” said Adobe CEO Shantanu Narayen. Sign up now for FREE unlimited access to Reuters.comSign up Adobe has sharpened its focus in the collaboration tools space in recent years through acquisitions. It acquired task management platform Workfront in 2020 and cloud-based video collaboration platform Frame.io last year. However, shares fell 13% in early trading. Some analysts pointed to the size of the deal that could require Adobe to raise debt. The company had cash and cash equivalents of $3.87 billion as of Sept. 2. “We are disappointed at the price paid for the company (Figma),” said David Wagner, a portfolio manager and equity analyst at Aptus Capital Advisors which owns a 1.5 percent stake in Adobe. “It tends not to be a good sign when a company has to acquire to defend share. It’s not a viable solution.” A CNBC report last month said thousands of Microsoft ( MSFT.O ) employees use Figma, putting pressure on the close relationship the software giant shares with Adobe. Distribution to machines running Windows helped Adobe gain ubiquity, and companies also sync their products across platforms. The deal is expected to close in 2023, and San Francisco-based Figma will continue to be led by co-founder and CEO Dylan Field. Each company would have to pay a $1 billion termination fee if it scraps the deal. Meanwhile, Adobe’s fourth-quarter revenue forecast of $4.52 billion was below analysts’ estimate of $4.58 billion, according to data from Refinitiv. Third-quarter earnings also fell nearly 6 percent, reflecting a hit from a stronger dollar and higher costs. Sign up now for FREE unlimited access to Reuters.comSign up Reporting by Chavi Mehta and Tiyashi Datta in Bengaluru. Edited by Devika Syamnath and Sriraj Kalluvila Our Standards: The Thomson Reuters Trust Principles.
