On Monday, PepsiCo announced that it would pay $1.95 billion to acquire the prebiotic soda brand Poppi.
PepsiCo now has a rapidly expanding brand in the well-liked functional beverage market thanks to the acquisition.
In a statement, PepsiCo Chairman and CEO Ramon Laguarta said, “Consumers are searching for convenient and delicious options that fit their lifestyles and address their growing interest in health and wellness more than ever before.”
According to PepsiCo, the deal includes expected cash benefits of $300 million, making the total purchase price $1.65 billion.
Poppi, a company situated in Austin, Texas, co-founder Allison Ellsworth claimed the partnership with PepsiCo will increase Poppi’s market share.
In a statement, Ellsworth stated, “We are excited to start this next chapter with PepsiCo to bring our soda to more people – and I know they will honor what makes Poppi so special while supporting our next generation of growth and innovation.”
In 2015, Ellsworth, who loved soda but was fed up with the way it made her feel, created Poppi, then known as Mother Beverage, in her home. She created a drink at farmer’s markets by combining fruit juices, apple cider vinegar, sparkling water, and prebiotics.
After Ellsworth and her husband presented the business on “Shark Tank,” it became popular in 2018. Rohan Oza, one of the show’s investors, invested in Mother Beverage and carried out a significant rebranding. Poppi was created with its vibrant, fruit-forward cans.
Oza, co-founder of CAVU Consumer Partners, which has already made investments in beverage brands like Oatly and Bai, stated, “We are incredibly excited to be collaborating with PepsiCo so that even more consumers across America, and the world, can enjoy Poppi.”
But for Poppi, things haven’t always gone as planned. Customers who claimed that the brand’s products didn’t enhance gut health as much as their marketing implied filed several class-action lawsuits against it last summer.
Poppi refuted those allegations, pointing out that in late 2023 it took any mention of “gut health” off of its packaging. However, Poppi has consented to a settlement that includes a $8.9 million fund for customer payments, per a court filing last week. On May 8, a hearing regarding the settlement is planned.
Monday morning trading saw a nearly 2% increase in PepsiCo shares.
