The companies’ products are part of most every desktop publisher, digital graphic artist and web designer’s toolbox. Adobe’s Acrobat Reader is bundled with Windows and Macintosh operating systems to read Portable Document Files and its Photoshop is an industry standard for digital manipulation and the creation of images. Macromedia’s DreamWeaver is a popular fully-integrated web design application, and its Flash is used to create everything from web banners to television animation.
Rivals in the past, each northern California firm sold some products similar to those of its competitor’s, such as Macromedia’s Fireworks, an image manipulation program, and Adobe’s GoLive, its web design tool. Merger rumors have been circulating for years.
Adobe is the bigger company, with reported sales of almost $1.3 billion in fiscal 2003. Macromedia made $370 million in fiscal 2004. The combined companies will retain Adobe’s name and its senior staff, according to the plan. Macromedia CEO Stephen Elop will join Adobe as its president of worldwide field operations. Bruce Chizen will remain as Adobe’s CEO and Shantanu Narayanb will continue as its president and chief operating officer.
Following this morning’s announcement, Adobe shares fell 11 percent in early Nasdaq trading, while Macromedia’s went up 8.3 percent.
There is no word yet on layoffs or how the companies’ products will be integrated.
"While we anticipate the integration team will identify opportunities for cost savings by the time the acquisition closes, the primary motivation for the two companies’ joining is to continue to expand and grow our business into new markets," Chizen said.