PepsiCo is acquiring the Austin-based prebiotic soda brand Poppi for $1.95 billion.

The acquisition, announced Monday, March 17, 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 Austin co-founder of 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 percent in morning trading Monday.