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Pepsi said it will acquire Poppi, a fast-growing prebiotic soda brand, the company said in a news release on Monday, Mar. 17. The $1.95 billion deal aims to strengthen Pepsi's push into health-focused beverages.
The Texas-based brand, founded by husband-and-wife duo Allison and Stephen Ellsworth, skyrocketed in popularity after landing an investment on the TV show "Shark Tank". With its mix of prebiotics, fruit juice, and apple cider vinegar, Poppi has built a loyal following as a low-calorie alternative to traditional soda, boasting no more than five grams of sugar per serving.
PepsiCo said the acquisition aligns with the company's push for more functional beverages.
"As we look to reorient our portfolio offerings to address white space consumer needs, the Poppi brand's unique intersection with wellness and culture is a perfect addition to our portfolio," said Ram Krishnan, PepsiCo's CEO of US beverages. "Allison and the Poppi team have built a magnetic brand that's ahead of the trends, with a loyal consumer base and a demonstrated capacity for growth. We are big fans of the Poppi brand movement and believe this incredible brand paired with our commercial capabilities will drive continued growth and innovation for years to come."
Allison Ellsworth said she's surprised at how much Poppi has grown.
"When I created Poppi in our kitchen, it was fueled by a desire to create a better-for-you soda," she said. "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 believe Poppi is the soda that will be embraced for generations to come, and we're beyond grateful to the amazing Poppi team, our partners who believed in us from the very beginning and most importantly our incredible community.
"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. I hope our story inspires others to explore their passions, take the risk, and believe that anything is possible."
Rohan Oza, a "Shark Tank" guest investor and co-founder of CAVU Consumer Partners, called Poppi’s rise "a true testament to the American Dream."
"From the kitchen to "Shark Tank" to becoming an iconic brand, this couldn't have been done without the amazing founders Allison and Stephen Ellsworth, the incredible team in place led by CEO Chris Hall, the unmatched support of CAVU's Uncommon team led by Stevie Clements, and the extraordinary Poppi community," Oza said. "We're beyond thrilled to be partnering with PepsiCo so that even more consumers across America, and the world, can enjoy poppi – a truly modern soda for the next generation."
Pepsi's purchase of Poppi comes a few weeks after Coca-Cola announced the launch of its own prebiotic soda. Simply Pop hopes to compete with established brands like Olipop and Poppi in the prebiotic doa industry, which is projected to reach $766.1 million by 2030, according to Grand Valley Research.
The deal includes $300 million in expected tax benefits, bringing the net purchase price to $1.65 billion. An additional earnout is tied to future performance.
The transaction is subject to regulatory approval and additional terms were not disclosed.
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