Petstages Inc., a privately held pet toy maker, is looking to secure a private equity sponsor after walking away from a deal with a strategic company. The company's management decided they would still like to own PetStages and as a result are now looking for an infusion of capital by way of a private equity backer. Northbrook, Ill.-based Petstages has retained Meadow Lane Capital LLC to advise on a sale, according to two sources familiar with the matter. The boutique investment bank's Chris Spahr is running the process, according to one of the sources. The firm, with U.S. offices in Chicago and New York, advised Chicago natural pet foods retailer Kriser's Natural Pet on its growth capital investment in March from New York PE house River Hollow Partners. The maker of developmental pet toys had received a letter of intent from a strategic buyer, said the sources, one of whom explained that after Petstages' founders ultimately decided they wanted to maintain an equity stake, that potential deal fell through and the process shifted to private equity.