PepsiCo Acquires Poppi for $1.95 Billion

PepsiCo announced its acquisition of prebiotic soda brand Poppi for $1.95 billion, with a net purchase price of $1.65 billion after anticipated cash tax benefits. This strategic move aims to bolster PepsiCo's presence in the 'healthier soda' category, a segment experiencing significant growth as young Americans increasingly opt for wellness-focused beverages. Poppi, founded by Poppi (drink) and Poppi (drink), combines prebiotics, fruit juice, and apple cider vinegar, and has seen its retail sales jump 122% year-over-year. The deal comes as PepsiCo faces declining demand for its traditional sodas and Lay's snacks, and follows previous acquisitions like Siete Foods and the remaining stake in PepsiCo — Sabra (company), signaling a broader diversification strategy. The functional soda market is highly competitive, with The Coca-Cola Company launching its own prebiotic soda, 'Simply Pop,' and other players like Celsius Holdings and Keurig Dr Pepper also making inroads. Poppi's competitor, Olipop, recently secured a $50 million funding round, valuing it at $1.85 billion. The acquisition is pending regulatory approval and includes additional payouts to Poppi if certain performance metrics are met.