UK regulator, the Competition and Markets Authority (CMA) has referred Adobe’s (NASDAQ: ADBE) $20 billion acquisition of Figma to an in-depth probe after the companies informed the regulator that they would not offer any solutions to ease the regulators’ concerns.
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Late last month, the UK regulator raised concerns that the Figma deal “…could mean less choice for designers of digital apps, websites, and other products.” Which it certainly could; one less competitor in the market is one less, no matter how you slice it. The regulator went on to note that Adobe had been investing heavily in such design sectors itself, and should Adobe ultimately buy Figma, that “…important rivalry could be lost….”
While the regulator had given Adobe five days to address its concerns, the company told CMA on July 7 that it could not offer any remedies to address its concerns.
Analysts are cautiously optimistic about ADBE stock with a Moderate Buy consensus rating based on 16 Buys, 11 Holds, and one Sell.