PepsiCo has announced its acquisition of Poppi, a fast-growing prebiotic soda brand, for a staggering $1.95 billion. This move solidifies PepsiCo’s commitment to expanding its portfolio within the popular functional beverage market.
In a statement, PepsiCo’s Chairman and CEO, Ramon Laguarta, highlighted the increasing consumer demand for healthier, convenient beverage options, 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.’
The acquisition details reveal that the total deal includes $300 million in anticipated cash benefits, ultimately bringing the net purchase price down to $1.65 billion.
Allison Ellsworth, co-founder of Poppi, expressed enthusiasm about the merger, stating, ‘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.’
Poppi was developed in 2015 by Ellsworth, who initially created the drink in her kitchen due to her passion for soda and desire for healthier alternatives. The brand gained significant popularity after a successful pitch on the reality show ‘Shark Tank’ in 2018 and underwent rebranding to its current name.
Rohan Oza, who invested in the brand after the pitch, remarked, ‘We’re beyond thrilled to be partnering with PepsiCo so that even more consumers across America, and the world, can enjoy Poppi.’
Despite its success, the journey has not been entirely smooth for Poppi. The brand faced multiple class-action lawsuits last summer regarding misleading health claims affecting gut health, to which Poppi responded by removing such references from its packaging. According to recent court filings, the brand has agreed to a settlement totaling $8.9 million, with a hearing scheduled for May 8.
Following the announcement of the acquisition, shares of PepsiCo rose nearly 2% in morning trading Monday, reflecting investor confidence in the strategic move.
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