Despite the failed $20 billion acquisition by Adobe, online design company Figma is expected to be fine, with an estimated worth of $8.3 billion to $9 billion according to CB Insights. Figma will receive a $1 billion termination fee from Adobe, although the regulatory limbo the company endured during the acquisition process has taken its toll. While breakup fees are not the norm in most M&A deals, the size and antitrust risk of the Adobe-Figma deal justify the fee.
Adobe has decided to terminate its $20 billion cash-and-stock deal to acquire cloud-based designer platform Figma due to regulatory hurdles in the European Union and the UK. The deal faced scrutiny from antitrust regulators concerned about Big Tech acquisitions and market power. Adobe will pay a termination fee of $1 billion to Figma. Shares of Adobe rose about 1.7% premarket. The company argued that it does not compete with Figma and disagreed with the regulatory findings. The deal was seen as a bet on the future of work but faced investor concerns over the price tag.
Intel has announced the termination of its planned $5.4 billion acquisition of Israeli chipmaker Tower Semiconductor due to the failure to obtain the necessary regulatory approvals. The deal would have given Intel access to specialty technologies such as radio frequency and industrial sensors. Intel will pay a termination fee of $353 million to Tower Semiconductor. Chinese authorities did not publicly communicate their approval for the purchase before the deadline passed.
Microsoft and Activision Blizzard have extended their $69 billion takeover deal deadline to October 18. The agreement includes an increase in the termination fee payable to Activision Blizzard if the transaction is terminated after certain dates. Additionally, there are amendments to Activision Blizzard's commercial Xbox arrangements with Microsoft, valued at up to $250 million for FY23 and FY24. Activision Blizzard reported second-quarter revenue growth of 34.2% YoY, driven by the launch of Diablo IV. The deal has faced opposition from Britain's competition regulator, but Microsoft has forged deals with Nvidia and Sony to address concerns.
Kick has offered to pay the $25 termination fee for Twitch Affiliates who cancel their contract and join Kick. Twitch recently updated its Affiliate agreement terms and conditions to include the fee, causing frustration among users and content creators. Kick's response has been met with enthusiasm from some Twitch streamers, but it remains to be seen if any major stars will jump ship.
