Advent plans sale of Partner in Pet Food -sources

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By Anjuli Davies and Martinne Geller

LONDON, March 2 (Reuters) - Partner in Pet Food (PPF), a European pet food maker, has been put up for sale by private equity firm Advent International, sources familiar with the matter said on Monday.

The move by Advent is the latest in a string of deals in a growing and increasingly lucrative pet care industry.

Annual operating income at Hungary's PPF is estimated at between 30 million euros ($33.7 million) and 35 million euros, one of the sources said. That could lead to an asking price of more than 300 million euros, another of the sources said.

Last year Procter & Gamble sold the bulk of its pet food business to Mars Inc for $2.9 billion and U.S. pet supply retailer PetSmart (NasdaqGS: PETM - news) agreed to be taken private for $8.7 billion by a consortium led by private equity firm BC Partners (Other OTC: PGPHF - news) .

J.M. Smucker last month said it would buy Big Heart Pet Brands, maker of Meow Mix and Milk Bone, for $3.2 billion.

"The amount of money that owners have been spending on their pets has continued to grow as consumers splash out more for higher-quality products such as healthier food," ratings agency Moody's said in a note after the Big Heart deal.

"Pet owners also increasingly view their pets as part of the family, which contributes to making pet spending more 'essential'."

Advent bought Budapest-based PPF, Europe's second-biggest provider of private-label pet food, from Permira in 2011 for 188 million euros. Last month PPF reported 2014 sales up 5 percent to 235 million euros and said it had won a contract to supply Tesco (Xetra: 852647 - news) , Britain's biggest grocer, with dry and wet food for dogs and cats to be sold under the retailer's own label.

Advent is being advised by JP Morgan, the sources said.

Officials for PPF, Advent and JP Morgan declined to comment.

In Europe, the pet products and services industry was worth more than 24 billion euros in 2012, according to the European Pet Food Industry Federation. The American Pet Products Association pegged the U.S. industry at $58.5 billion last year.

PPF's products are sold in 37 markets. It has 1,200 employees and eight factories in Hungary, Slovakia, the Netherlands and the Czech Republic. ($1 = 0.8914 euros) (Editing by David Goodman)