The purchase of Petsense LLC, a specialty retailer that claims to provide "premium natural pet food from the brands you know and trust and at more affordable prices than those other big city stores," by rural-lifestyle-store chain Tractor Supply Co. (Nasdaq: TSCO), for $116 million in a deal announced Sept. 30, underscores the value that strategic buyers and private equity firms perceive in pets.

Long-time cat owners, we recently added a dog to our family, and the experience has given me some insight into the pet subsector of the consumer and packaged goods industry. Before our puppy Teddy arrived, we went through a classic “nesting” period, during which we bought stuff to make the newborn comfortable. These were one-time purchases: a carrier, a bed and an exercise pen. But now that Teddy is home, he needs a steady stream of food, treats, toys, and training pads – what private equity investors call “recurring streams of revenue.”

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