PepsiCo Inc. will acquire healthier soda brand Poppi for $1.95 billion, the Purchase-based soda giant announced on Monday, confirming an earlier Bloomberg News report.
The deal includes $300 million in expected cash tax benefits for a net purchase price of $1.65 billion. The deal also includes other potential payouts from PepsiCo if Poppi meets certain performance metrics.
PepsiCo is working to diversify away from its standard soda and snacks by making acquisitions of healthier brands. In October, it announced plans to acquire snack food maker Siete Foods for $1.2 billion. The following month, it said it would buy the remaining 50% of Sabra Dipping Co. and PepsiCo-Strauss Fresh Dips & Spreads International GmbH.
The “functional soda” category has been growing, especially compared to standard sodas. The lower-sugar beverages can include ingredients not found in standard soda, such as prebiotics, probiotics and added fiber and say they are aimed at improving digestive health. Poppi uses prebiotics, fruit juice and apple cider and its drinks have 5 grams of sugar or less per serving.
“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,” said PepsiCo CEO Ramon Laguarta in a statement.
