Probiotic Takeover? PepsiCo Looking to Buy KeVita

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PepsiCo Inc. is in confidential negotiations to possibly add another probiotic provider, KeVita Inc., to its list of health-conscious beverage providers.

The acquisition of the sparkling probiotic beverage company is part of PepsiCo’s move to cut back on sugar in its drinks. The concern first began as public health concerns drove its soft drink sales to decline.

“The company will continue to refine its food and beverage choices to meet changing consumer needs by reducing added sugars, saturated fat and sodium levels in its product portfolio,” Pepsi said in a statement to CNN.

PepsiCo looks to acquire KeVita through its venture arm, known as Naked Emerging Brands. The arm’s goal is to add brands to PepsiCo that appeal to health-conscious consumers. The beverage magnet owns a minority stake in KeVita, including a distribution agreement.

While there’s the possibility the negotiations could fall through, the deal could be finalized this month. PepsiCo would value KeVita at less than $500 million.

PepsiCo declined to comment about the acquisition, and said the company does not comment on “rumor or speculation,” and no official confirmation has been made about the negotiations.

This isn’t PepsiCo’s first venture into brands featuring probiotics. Brands already in the company’s line up, like Tropicana, offer probiotics as well. KeVita, based in Oxnard, California, offers sparkling probiotic drinks, organic teas and cleansing probiotic tonics.

All KeVita drinks are certified organic and are non-GMO. Instead of using artificial sweeteners such as aspartame that is seen in many soft drinks, the majority of KeVita’s beverages are sweetened with stevia. All of KeVita’s drinks are considered to help with digestion.

KeVita added its newest flavors last month. Dragonfruit Lemongrass, Mango Habanero and Citrus were all added to the organic probiotic drink and tea lines. Turmeric Ginger, Cinnamon and Chili Ginger Lime were flavors added to the probiotic apple cider vinegar tonics line in August.

Co-founders Bill Moses and Chakra Earthsong began KeVita in 2009 in Ojai, California. The company’s mission is to “inspire people to take control of their health and well-being in order to reach their highest potential,” according to the company’s website.

PepsiCo would add KeVita to its health-conscious drinks already available to consumers, such as Naked Juice and O.N.E. Coconut Waters. To further the move away from sugars and artificial sweeteners, the company declared that two-thirds of its single serving drinks will have 100 or fewer calories by 2025.

Less than 40 percent of its drinks have 100 calories or fewer, even after Pepsi’s move away from aspartame after studies linked artificial sweeteners to health issues such as obesity and diabetes.

Ten months after announcing the pull away from aspartame, it brought the chemical back with its launch of Diet Pepsi Classic Sweetener Blend. The company said it was an effort to appeal to consumers who liked the artificial sweetener.

“For those consumers who love Diet Pepsi with aspartame, we have been exploring ways to make it available,” the company said in a statement to CNN.

PepsiCo company is responsible for distributing a wide range of beverages, from Aquafina water to Ocean Spray and Tropicana juices to AMP energy drinks.

Tori Linville
Tori Linville is a freelance writer and editor from Clarksville, Tennessee. When she isn’t writing or teaching, she’s faithfully watching her alma mater, the University of Alabama, dominate the football field.
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