On Monday, PepsiCo, Inc. ( PEP ) announced its plan to acquire the popular prebiotic soda brand, Poppi, in a deal worth $1.95 billion.

This includes $300 million in expected tax benefits, reducing the net purchase price to $1.65 billion. The acquisition also comes with an additional earnout consideration based on achieving specific performance goals after the transaction’s closure.

“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. poppi is a great complement to our portfolio transformation efforts to meet these needs,” said Chairman and CEO Ramon Laguarta.

Poppi’s acquisition comes as the rapidly growing functional soda brand has achieved notable success thanks to its distinctive mix of prebiotics, fruit juice, and apple cider vinegar.

Also Read: Why Is Clothing Firm Guess Stock Surging Today?

The product, renowned for its low calorie count and no more than five grams of sugar per serving, has built a dedicated and enthusiastic following.

Founded by Allison and Stephen Ellsworth, Poppi gained further visibility after being featured on Shark Tank, and secured backing from Rohan Oza and CAVU Consumer Partners, cementing its place as a leader in the beverage market.

“Allison and the poppi team have built a magnetic brand that’s ahead of the trends, with a loyal consumer base and a demonstrated capacity for growth. We are big fans of the poppi brand movement and believe this incredible brand paired with our commercial capabilities will drive continued growth and innovation for years to come,” said CEO, PepsiCo Beverages U.S., Ram Krishnan.

With the transaction now subject to regulatory approval and other standard conditions, the deal is expected to further expand PepsiCo’s presence in the functional beverage market.

The exact terms of the deal beyond the financial aspects have not been disclosed. PepsiCo ( PEP ) held $8.5 billion in cash and equivalents as of December 28.

Price Action: PEP shares traded higher by 1.86% at $151.35 at last check Monday.

Read Next:

AstraZeneca Seals Deal For EsoBiotec To Advance Cell Therapy: Details