Adobe CEO Shoots Down Microsoft Acquisition Rumor

Microsoft and Adobe are reportedly working together to chip away at Apple's dominance in the mobile phone market, but Adobe's top executive is throwing cold water on the smoldering rumor that Microsoft might acquire his company.

"Adobe's growth prospects are so great that our focus is on seizing these opportunities as an independent company," Adobe CEO Shantanu Narayen told the Financial Times Deutschland on Monday, as reported by Reuters.

Earlier this month, Narayen met with Microsoft CEO Steve Ballmer at Adobe headquarters to discuss a partnership aimed at slowing Apple's mobile momentum, as well as a possible acquisition of Adobe by Microsoft, according to an Oct. 7 report in The New York Times.

The following day, Ballmer declined to comment on The New York Times report, although enigmatically enough to leave the door open for further speculation. "If you are going to do something, you say nothing," Ballmer said at a conference in Spain. "So I'll be entirely consistent with standard CEO operating procedure."

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Microsoft was interested in acquiring Adobe several years ago, according to The New York Times, but the rumor is nonetheless one of the more bizarre and illogical to come around in a while. Adobe investors took the report at face value, though, sending the company's shares up 17 percent on the day it was published.

Next: Why A Microsoft-Adobe Partnership Makes Sense

Adobe and Microsoft are obviously looking to derail Apple's progress in mobility, and the two companies share many of the same customers. But aside from the notion that Microsoft might want to gobble up Flash to further its agenda with Silverlight, it's hard to see where the synergies would lie in such a deal.

Apple CEO Steve Jobs hasn't been shy about his disdain for Adobe Flash: In addition to the well-publicized barriers to Flash on the iPhone, Apple last week said it will no longer pre-install Flash on new Macs. Microsoft, meanwhile, has been getting its lunch eaten by Apple in the mobile space and is embarking on a major marketing campaign for its new mobile OS, Windows Phone 7.

Adobe has been forging ahead with its strategy of getting Flash onto mobile devices, and on Monday the company released AIR 2.5, the latest iteration of its development suite for building apps that run not only on desktops, but also on smartphones, tablets and the coming wave of interactive televisions.