Adobe (NASDAQ:ADBE) stock declined over 6% on Wednesday, as U.K.’s antitrust regulator, Competition and Markets Authority (CMA), opened an inquiry into the creative and business software giant’s $20 billion proposed acquisition of design software company Figma. Adobe announced an agreement to acquire Figma in September 2022.
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Regulators in the U.S. and other countries are aggressively scrutinizing potential acquisitions by tech giants to ensure that they don’t thwart smaller rivals and impact competition. Last week, CMA blocked Microsoft’s (MSFT) acquisition of gaming company Activision Blizzard (ATVI), citing concerns about its impact on the emerging cloud gaming space.
CMA has set June 30 as the deadline for its phase 1 decision on the Adobe-Figma deal. Earlier this year, the European Commission stated that it would assess Adobe’s Figma acquisition, saying the transaction “threatens to significantly affect competition in the market for interactive product design and whiteboarding software.”
Meanwhile, Adobe said that it would continue to engage with the U.S. Department of Justice, CMA, and European Commission in “productive discussions” about aspects related to the deal. The company had earlier stated that it expects the acquisition to close by the end of this year.
What is the Price Target for Adobe Stock?
With 10 Buys and 13 Holds, Adobe scores Wall Street’s Moderate Buy consensus rating. The average price target of $397.16 suggests 15% upside. Shares have advanced over 2% year-to-date.
