Gabelli Funds announced the launch of Gabelli Food of All Nations NextShares (FOANC), which will invest primarily in common stocks of domestic and foreign companies of all capitalizations in the food and beverage industries.
FOANC will list and commence trading on Nasdaq Stock Market on Tuesday. The primary objective of the fund is capital appreciation. FOANC is the second member of the Gabelli NextShares Trust, a nontransparent, exchange-traded managed fund (ETMF), offered under an agreement with NextShares Solutions LLC, a subsidiary of Eaton Vance Corp.
Consumer companies have long been a core competency at GAMCO. Gabelli Funds is a subsidiary of GAMCO Investors Inc.
GAMCO considers food and beverage companies in particular strong businesses because they are cash flow generators that have recurring revenue and enjoy pricing power.
According to Kevin Dreyer, portfolio manager and co-CIO of GAMCO Investors, the new fund reflects the promising growth prospects they see in this sector.
Growth in the food and beverage market — which currently represents more than $5 trillion globally and $1.5 trillion in the United States — is driven by population growth, pricing and, increasingly, the rise of the emerging middle class around the world.
According to Dreyer, a growing middle class offers an untapped market as emerging market economies transition to consumption-oriented markets with a new taste for branded food, beverage and consumer products.
Dreyer also believes a consolidation trend in the food and beverage industry will provide opportunities for investors. Companies in the food and beverage industries are doing more deals, and the sector is becoming increasingly consolidated.
“We see great opportunity for investors in both potential targets and acquirers as consolidation continues to play out in coming years,” he said in a statement.
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