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PepsiCo buys prebiotic soda brand Poppi to gain a foothold in functional drinks

Business

PepsiCo buys prebiotic soda brand Poppi to gain a foothold in functional drinks
Business

Business

PepsiCo buys prebiotic soda brand Poppi to gain a foothold in functional drinks

2025-03-17 22:46 Last Updated At:22:50

PepsiCo said Monday it’s acquiring the prebiotic soda brand Poppi for $1.95 billion.

The acquisition gives PepsiCo a fast-growing brand in the popular functional beverage category.

“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,” PepsiCo Chairman and CEO Ramon Laguarta said in a statement.

PepsiCo said the transaction includes $300 million of anticipated cash benefits, bringing the net purchase price to $1.65 billion.

Allison Ellsworth, the co-founder of Austin, Texas-based Poppi, said the combination with PepsiCo 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.

Ellsworth developed Poppi – then known as Mother Beverage -- in her kitchen in 2015 because she loved soda but was tired of the way it made her feel. She mixed fruit juices with apple cider vinegar, sparkling water and prebiotics and sold the drink at farmer's markets.

The brand took off in 2018 when Ellsworth and her husband pitched it on “Shark Tank.” An investor on the show, Rohan Oza, took a stake in Mother Beverage and undertook a major rebrand. Poppi, with its brightly-colored, fruit-forward cans, was born.

“We’re beyond thrilled to be partnering with PepsiCo so that even more consumers across America, and the world, can enjoy Poppi,” said Oza, the co-founder CAVU Consumer Partners, which has also invested in beverage brands like Oatly and Bai.

But it hasn’t all been smooth sailing for Poppi. Last summer, multiple class-action lawsuits were filed against the brand by consumers who said its products don’t improve gut health as much as their marketing suggests.

Poppi denied those claims, and noted that it removed references to “gut health” from its packaging in late 2023. But according to a court filing last week, Poppi has agreed to a settlement that includes an $8.9 million fund for payments to consumers. A hearing on the settlement is scheduled for May 8.

PepsiCo shares rose nearly 2% in morning trading Monday.

FILE - A can of Poppi prebiotic soda is shown on Wednesday, April 10, 2024, in New York. (AP Photo/John Minchillo, file)

FILE - A can of Poppi prebiotic soda is shown on Wednesday, April 10, 2024, in New York. (AP Photo/John Minchillo, file)

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PHOTO COLLECTION: Top photos from Cannes 2025 Day 2

2025-05-15 03:59 Last Updated At:04:01

This is a photo collection curated by AP photo editors.

Tom Cruise, left, and director Christopher McQuarrie pose for photographers during the photo call for the film 'Mission: Impossible – The Final Reckoning' at the 78th international film festival, Cannes, southern France, Wednesday, May 14, 2025. (Photo by Scott A Garfitt/Invision/AP)

Tom Cruise, left, and director Christopher McQuarrie pose for photographers during the photo call for the film 'Mission: Impossible – The Final Reckoning' at the 78th international film festival, Cannes, southern France, Wednesday, May 14, 2025. (Photo by Scott A Garfitt/Invision/AP)

Pom Klementieff, from left, Angela Bassett, Tom Cruise, Hayley Atwell, and Hannah Waddingham pose for photographers during the photo call for the film 'Mission: Impossible – The Final Reckoning' at the 78th international film festival, Cannes, southern France, Wednesday, May 14, 2025. (Photo by Joel C Ryan/Invision/AP)

Pom Klementieff, from left, Angela Bassett, Tom Cruise, Hayley Atwell, and Hannah Waddingham pose for photographers during the photo call for the film 'Mission: Impossible – The Final Reckoning' at the 78th international film festival, Cannes, southern France, Wednesday, May 14, 2025. (Photo by Joel C Ryan/Invision/AP)

Hannah Waddingham poses for photographers during the photo call for the film 'Mission: Impossible – The Final Reckoning' at the 78th international film festival, Cannes, southern France, Wednesday, May 14, 2025. (Photo by Scott A Garfitt/Invision/AP)

Hannah Waddingham poses for photographers during the photo call for the film 'Mission: Impossible – The Final Reckoning' at the 78th international film festival, Cannes, southern France, Wednesday, May 14, 2025. (Photo by Scott A Garfitt/Invision/AP)

Greg Tarzan Davis, from left, Hayley Atwell, Angela Bassett, Tom Cruise, director Christopher McQuarrie, Tramell Tillman, Simon Pegg, Hannah Waddingham, Pom Klementieff, Esai Morales, and writer Erik Jendresen pose for a selfie upon arrival at the premiere of the film 'Mission: Impossible - The Final Reckoning' at the 78th international film festival, Cannes, southern France, Wednesday, May 14, 2025. (Photo by Joel C Ryan/Invision/AP)

Greg Tarzan Davis, from left, Hayley Atwell, Angela Bassett, Tom Cruise, director Christopher McQuarrie, Tramell Tillman, Simon Pegg, Hannah Waddingham, Pom Klementieff, Esai Morales, and writer Erik Jendresen pose for a selfie upon arrival at the premiere of the film 'Mission: Impossible - The Final Reckoning' at the 78th international film festival, Cannes, southern France, Wednesday, May 14, 2025. (Photo by Joel C Ryan/Invision/AP)

Simon Pegg poses for photographers during the photo call for the film 'Mission: Impossible – The Final Reckoning' at the 78th international film festival, Cannes, southern France, Wednesday, May 14, 2025. (Photo by Joel C Ryan/Invision/AP)

Simon Pegg poses for photographers during the photo call for the film 'Mission: Impossible – The Final Reckoning' at the 78th international film festival, Cannes, southern France, Wednesday, May 14, 2025. (Photo by Joel C Ryan/Invision/AP)

Tom Cruise, left and director Christopher McQuarrie pose for photographers during the photo call for the film 'Mission: Impossible – The Final Reckoning' at the 78th international film festival, Cannes, southern France, Wednesday, May 14, 2025. (Photo by Scott A Garfitt/Invision/AP)

Tom Cruise, left and director Christopher McQuarrie pose for photographers during the photo call for the film 'Mission: Impossible – The Final Reckoning' at the 78th international film festival, Cannes, southern France, Wednesday, May 14, 2025. (Photo by Scott A Garfitt/Invision/AP)

Tom Cruise poses for photographers during the photo call for the film 'Mission: Impossible – The Final Reckoning' at the 78th international film festival, Cannes, southern France, Wednesday, May 14, 2025. (Photo by Scott A Garfitt/Invision/AP)

Tom Cruise poses for photographers during the photo call for the film 'Mission: Impossible – The Final Reckoning' at the 78th international film festival, Cannes, southern France, Wednesday, May 14, 2025. (Photo by Scott A Garfitt/Invision/AP)

Tom Cruise poses for photographers upon arrival at the premiere of the film 'Mission: Impossible - The Final Reckoning' at the 78th international film festival, Cannes, southern France, Wednesday, May 14, 2025. (Photo by Lewis Joly/Invision/AP)

Tom Cruise poses for photographers upon arrival at the premiere of the film 'Mission: Impossible - The Final Reckoning' at the 78th international film festival, Cannes, southern France, Wednesday, May 14, 2025. (Photo by Lewis Joly/Invision/AP)

Greg Tarzan Davis, from left, editor Eddie Hamilton, Angela Bassett, Tramell Tillman, Tom Cruise, director Christopher McQuarrie, Hannah Waddingham, Simon Pegg, Esai Morales, and Pom Klementieff take a selfie upon arrival at the premiere of the film 'Mission: Impossible - The Final Reckoning' at the 78th international film festival, Cannes, southern France, Wednesday, May 14, 2025. (Photo by Scott A Garfitt/Invision/AP)

Greg Tarzan Davis, from left, editor Eddie Hamilton, Angela Bassett, Tramell Tillman, Tom Cruise, director Christopher McQuarrie, Hannah Waddingham, Simon Pegg, Esai Morales, and Pom Klementieff take a selfie upon arrival at the premiere of the film 'Mission: Impossible - The Final Reckoning' at the 78th international film festival, Cannes, southern France, Wednesday, May 14, 2025. (Photo by Scott A Garfitt/Invision/AP)

Andie MacDowell poses for photographers upon arrival at the premiere of the film 'Mission: Impossible - The Final Reckoning' at the 78th international film festival, Cannes, southern France, Wednesday, May 14, 2025. (Photo by Lewis Joly/Invision/AP)

Andie MacDowell poses for photographers upon arrival at the premiere of the film 'Mission: Impossible - The Final Reckoning' at the 78th international film festival, Cannes, southern France, Wednesday, May 14, 2025. (Photo by Lewis Joly/Invision/AP)

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