Oct. 7 (Bloomberg) -- Adobe Systems Inc. shares surged as much as 17 percent after the New York Times reported that Microsoft Corp. Chief Executive Officer Steve Ballmer recently met with Adobe CEO Shantanu Narayen.
The executives recently had a meeting at Adobe’s offices in San Francisco, according to two people familiar with the matter, who asked not to be identified because the meeting was private.
Earlier, the New York Times reported that the discussion centered on Apple Inc.’s control of the mobile-phone market and how the two companies could work together to compete, the Times said. A possible acquisition of Adobe by Microsoft was among the options, according to the newspaper’s Bits blog.
“Adobe and Microsoft share millions of customers around the world and the CEOs of the two companies do meet from time to time,” said Charles Sipkins, a spokesman for Adobe. He declined to comment on the “timing or topics of their private meetings.”
Adobe rose $2.96, or 12 percent, to $28.69 at 4 p.m. on the Nasdaq Stock Market. Earlier in the session, the shares jumped as high as $30, triggering the circuit breaker halt for five minutes. The stock has declined 22 percent this year.
Adobe has clashed with Apple CEO Steve Jobs, who banned Adobe’s flash video software from Apple’s mobile devices. Adobe won a partial victory on Sept. 9, when Apple eased restrictions on creating applications for its iPhone and iPad devices. Apple had barred developers from using Adobe’s Flash video software.
Still, the change didn’t let Flash apps run inside the browser on Apple devices, and that’s a larger concern, Jeff Gaggin, an analyst at Avian Securities Inc. in New York, said last month. Apple, which dominates the market for mobile apps, is promoting an Internet standard called HTML5 instead.
At the meeting, which included a “small entourage of deputies,” Ballmer and Adobe discussed how they might counter Apple’s position in smartphones, the New York Times reported. The companies had held informal discussions about a Microsoft acquisition of Adobe several years ago, according to the report. Adobe has a market value of $15.1 billion.
Frank Shaw, a spokesman at Redmond, Washington-based Microsoft, declined to comment.
Adobe forecast sales last month that fell short of analysts’ estimates, sending the shares down the most in eight years. Cash-strapped schools aren’t paying for as many copies of the product, which includes Photoshop and Illustrator, the San Jose, California-based company said. The sluggish economy in Japan, typically Adobe’s biggest Asian market, also hampered sales.
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