On Monday, PepsiCo announced that it would acquire better-for-you prebiotic soda brand Poppi for $1.95 billion.
According to the companies’ joint press release, the deal includes $300 million of anticipated cash benefits bringing the net purchase price to $1.65 billion. Poppi, founded by husband-and-wife duo Stephen and Allison Ellsworth, has gained popularity over the years for its prebiotic-filled, low sugar sodas, which are available at most major retailers including Target and Walmart. This announcement follows several swirling rumors last Friday regarding the news.
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Per PepsiCo’s chairman and chief executive officer Ramon Laguarta this is a strategic move for the company to expand its healthy offerings and meet the growing consumer demand for better-for-you products.
“We’ve been evolving our food and beverage portfolio over many years, including by innovating with our brands in new spaces and through disciplined, strategic acquisitions that enable us to offer more positive choices to our consumers,” he said in a statement. “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. Poppi is a great complement to our portfolio transformation efforts to meet these needs.”
Poppi has been growing rapidly over the past several years thanks to healthier consumer behavior and several viral moments, including Super Bowl commercials, a New York Fashion Week party, the cult-followed matching sweatsuits and buzzy social media campaigns, such as sending branded vending machines to influencers.
“When I created Poppi in our kitchen, it was fueled by a desire to create a better-for-you soda,” Allison Ellsworth said in a statement. “We never imagined how many people we could reach through hard work, determination and a clear mission to create a functional soda that stands the test of time.…We can’t wait to begin this next chapter with PepsiCo to bring our soda to more people.”
Poppi had previously received a $400,000 investment for a 25 percent stake from investor and cofounder of Cavu Consumer Partners Rohan Oza on an episode of the TV show “Shark Tank” in 2018. The brand went on to secure a $25 million seed round in 2022 led by Cavu Consumer Partners.
Oza told WWD at the time: “We’re trying to create the modern soda of tomorrow, and that’s why we’ve invested in the brand because we believe in the potential of Poppi.”
He’d added that over the years Poppi had proved it could succeed in channels outside of health food stores and could easily compete with traditional sodas, further indicated by this PepsiCo acquisition.
Per the press release, “the transaction is subject to customary closing conditions, including regulatory approval.”