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May 22, 2018, 4:01 a.m. EDT

Adobe to buy e-commerce platform Magento in $1.68 billion deal

Photoshop maker should bolster its software portfolio via acquisition

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By Maria Armental


Ken Wolter / Shutterstock.com
Adobe Systems Inc. headquarters in San Jose, Calif.

Adobe Systems Inc., the elder software-business statesman behind photo-editing software Photoshop and PDF reader, is buying e-commerce firm Magento Commerce for $1.68 billion, adding a key piece to its platform.

The acquisition — which would put Adobe /zigman2/quotes/200389143/composite ADBE -1.38%   head-to-head with the likes of Salesforce.com — presents a revenue opportunity of some $13 billion, Brad Rencher, Adobe’s executive vice president of digital experience, said in a conference call Monday, citing market-research firm estimates.

Magento, already an Adobe partner, was bought in 2015 from eBay Inc. /zigman2/quotes/204653455/composite EBAY -0.69%   as part of a $925 million deal by a group of investors that included Permira, Sterling Partners, Longview Asset Management and Innotrac Corp. Permira carved out Magento in November of that year.

Magento, whose clients include Canon /zigman2/quotes/207639533/delayed JP:7751 +1.92%   and Rosetta Stone /zigman2/quotes/206662967/composite RST +3.68%   along with overlapping Adobe customers Coca-Cola Co. /zigman2/quotes/209159848/composite KO +1.84%   and Nestlé SA /zigman2/quotes/208115528/delayed CH:NESN -0.45%  , handles more than $150 billion in gross merchandise volume, according to Permira. Under the terms of the deal, which is expected to close in the third quarter, Magento Chief Executive Mark Lavelle would continue to lead Magento’s roughly 700 workers as part of Adobe’s digital experience business, Adobe said.

An expanded version of this report appears on WSJ.com.

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2.92%
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CHF 102.66
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Oct. 21, 2019 9:58a
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