Adobe and Figma, the cloud-based design tool, will terminate their planned $20 billion merger in light of regulatory hurdles, the companies said Monday.

In a statement, the two companies said, “there is no clear path to receive necessary regulatory approvals from the European Commission and the UK Competition and Markets Authority.”

Adobe shares rose around 0.6% in Monday morning trading.

“Adobe and Figma strongly disagree with the recent regulatory findings, but we believe it is in our respective best interests to move forward independently,” Shantanu Narayen, CEO of Adobe, wrote in a statement. “While Adobe and Figma shared a vision to jointly redefine the future of creativity and productivity, we continue to be well positioned to capitalize on our massive market opportunity and mission to change the world through personalized digital experiences.”

Adobe first announced it would acquire Figma in September 2020 in a cash-and-stock deal worth about $20 billion. The news sent Adobe shares plunging, but the company reiterated that the acquisition would be a natural complement to Adobe’s portfolio, writing in the original announcement that “the combination of Adobe and Figma will usher in a new era of collaborative creativity.”

Adobe will pay Figma a $1 billion breakup fee, Adobe said in a regulatory filing.

The news is a sudden pivot from Narayen’s latest talking points, as he told CNBC on Wednesday that the company believes in the acquisition and its benefits for consumers.

“We want to take the ability for what Figma has done with respect to creative collaborative software on the web, combine that with what Adobe has done in our creative and make it even more accessible for others,” Narayen told CNBC’s Jim Cramer. “We think it’s an adjacency, we really believe in our merits of the case, but the regulatory environment is challenging.”

Antitrust regulators have increasingly scrutinized numerous tech deals big and small. In May, after the U.K.’s competition watchdog cited potentially anticompetitive effects, Meta sold Giphy to photo marketplace Shutterstock for $53 million, three years after it first acquired it. The CMA has also been reviewing Microsoft’s investment in OpenAI.

In Monday’s joint statement, Figma CEO Dylan Field wrote that “going through this process with Shantanu, David and the Adobe team has only reinforced my belief in the merits of this deal, but it’s become increasingly clear over the past few months that regulators don’t see things the same way.”

“We will continue to look for ways to partner with Figma to delight our joint customers,” David Wadhwani, a senior vice president at Adobe, wrote in a separate blog post.