PepsiCo has announced the acquisition of the prebiotic soda brand Poppi for $1.95 billion, aiming to establish a presence in the fast-growing functional beverage category.
The big picture: The purchase includes $300 million of anticipated cash benefits, making the net purchase price $1.65 billion.
Driving the news: The creation of Poppi – originally named Mother Beverage – was born out of Allison Ellsworth’s desire for a healthier soda alternative, initially developed in her kitchen in 2015 and featuring a blend of fruit juices, apple cider vinegar, sparkling water and prebiotics.
- After a successful appearance on “Shark Tank” in 2018, Poppi gained significant traction and underwent a rebrand led by investor Rohan Oza, ultimately leading to its current brightly-colored, fruit-focused cans.
- Despite its success, Poppi encountered legal challenges, facing class-action lawsuits alleging misleading marketing claims regarding gut health benefits. Poppi has since adjusted its packaging and agreed to a settlement, including an $8.9 million fund for consumer payments.
What they’re saying: “More than ever, consumers are looking for convenient and great-tasting options that fit their lifestyles and respond to their growing interest in health and wellness,” said PepsiCo Chairman and CEO Ramon Laguarta in a statement.
- Ellsworth said the deal will expand Poppi’s reach.
- “We can’t wait to begin 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 phase of growth and innovation,” Ellsworth said in a statement.
