PepsiCo has announced its acquisition of Poppi, a rapidly growing prebiotic soda brand, for $1.95 billion. This strategic move aims to strengthen PepsiCo’s presence in the functional beverage market, catering to the increasing consumer demand for healthier drink options.
Founded in 2015 by Allison and Stephen Ellsworth, Poppi began as Mother Beverage, gaining initial attention after a successful appearance on the television show “Shark Tank” in 2018. The brand rebranded to Poppi in 2020, focusing on offering low-calorie sodas infused with prebiotics, fruit juice, and apple cider vinegar to promote gut health. Poppi’s products are available in 14 flavors and have seen significant growth, with sales reportedly reaching $100 million by 2023.
The acquisition deal includes $300 million in anticipated cash tax benefits, bringing the net purchase price to $1.65 billion. PepsiCo’s CEO of Beverages in the U.S., Ram Krishnan, stated that integrating Poppi into their portfolio aligns with the company’s objective of addressing consumer wellness and cultural needs.
This move comes as major beverage companies respond to shifting consumer preferences toward healthier options. Coca-Cola, for instance, launched its own prebiotic soda line, Simply Pop, last month, entering the burgeoning prebiotic soda market, which is projected to grow significantly in the coming years.
However, Poppi has faced challenges, including multiple class-action lawsuits over its health benefit claims, leading to a recent $8.9 million settlement agreement. Despite these issues, PepsiCo’s shares saw a 2% rise in morning trading following the acquisition announcement.
The global prebiotic and probiotic soda market is expected to reach $766.1 million by 2030, growing at a compound annual growth rate of 8.2% from 2024 to 2030. This growth is driven by increasing consumer awareness and interest in gut health and digestive wellness.
PepsiCo’s acquisition of Poppi reflects the company’s strategy to diversify its product offerings and adapt to evolving consumer trends. By investing in functional beverages that promote health benefits, PepsiCo aims to capture a significant share of the expanding prebiotic soda market.
Sources:
- Associated Press: https://apnews.com/article/f1fdb1103b5d8ad6a9e6d8c37e5ab713
- Reuters: https://www.reuters.com/business/retail-consumer/pepsico-buy-healthier-soda-brand-poppi-nearly-2-bln-deal-2025-03-17/
- Investopedia: https://www.investopedia.com/pepsico-to-acquire-healthy-soda-brand-poppi-11698086
- Financial Times: https://www.ft.com/content/fb41fb3c-50f4-4665-b361-2c66db1ed109
- Barron’s: https://www.barrons.com/articles/pepsi-stock-poppi-brand-portfolio-4088ab90
- PepsiCo Press Release: https://www.pepsico.com/our-stories/press-release/pepsico-to-acquire-poppi03172025
- Fortune: https://fortune.com/2025/02/18/coca-cola-simply-pop-prebiotic-soda/
- Grand View Research: https://www.grandviewresearch.com/press-release/global-probiotic-prebiotic-soda-market
