NEW YORK, March 19 (Reuters) - The private equity owner

of Chosen Foods is preparing to explore a sale that could value

the avocado-based food products company at around $600 million

or more, including debt, according to people familiar with the

matter.

Chosen Foods is working with investment banks Morgan Stanley

and Bank of America on its sale process that is expected to

launch later this year, the sources said, requesting anonymity

as the discussions are confidential.

Los Angeles-based private equity firm Butterfly Equity,

which manages nearly $4 billion of assets and focuses on the

food and beverage industry, took a majority stake in Chosen

Foods in 2021. Butterfly's other investments include vitamin

maker MaryRuth Organics and fresh foods business Bolthouse

Farms.

Chosen Foods generates 12-month earnings before interest,

taxes, depreciation and amortization (EBITDA) of about $50

million, the sources said.

Butterfly, Chosen Foods, Morgan Stanley and Bank of

America declined to comment.

San Diego, California-based Chosen, which was launched in

2011, makes cooking sprays, oils, condiments, dressings and

other food products that are made out of fats from avocados.

The food and beverage sector has been a relatively bright

spot for dealmaking over the past year, even as overall consumer

deal volumes remain muted.

In September, J.M. Smucker agreed to buy Twinkies

maker Hostess Brands for $5.6 billion, including debt. In

August, Campbell Soup ( CPB ) struck a deal to buy Michael

Angelo's and Rao's owner Sovos Brands for $2.7 billion

Unilever recently acquired frozen yogurt brand Yasso in

North America, while Flagstone Foods acquired Emerald Nuts from

Campbell Soup ( CPB ) last year.