Pier 1 files for bankruptcy, hopes to sell company

Pier 1 files for bankruptcy, hopes to sell company”

Home decor and furniture retailer Pier 1 Imports Inc on Monday said it had filed for bankruptcy protection and was pursuing a sale, a month after it warned of its ability to continue as a going concern in a tough retail environment. Pier 1 expects the deadline for bids will be March 23.

The company's CEO Robert Riesbeck released a statement saying that the company, based in Fort Worth, Texas, reached a plan with lenders to provide it with $256 million.

The bankruptcy filing in the Eastern District of Virginia says that the 51-year-old company hopes to find a buyer for its remaining stores.

The filing, he said, is created to provide Pier 1 with more flexibility-and time-as it works to go ahead with a sale, Riesbeck explained, adding that his firm will "work to unlock additional value for our stakeholders".

During Pier 1's latest quarter, sales at stores open for at least one year decreased 11.4% compared to the same period last year.

Pier 1 previously announced it will close up to 450 stores, including all its locations in Canada.

The Shawnee store is expected to close in March
The Shawnee store is expected to close in March

Following court approval, the company expects that funding, combined with its own cash, to provide enough liquidity to support reduced operations and its sale process.

The company is also closing two distribution centers.

The company listed $189.5 million outstanding under a senior secured term loan, $50 million of borrowings under a first-in last-out tranche and $96 million of borrowings under a $350 million revolving credit facility as of November 30. Pier 1 faces competition from online players and other brick-and-mortar retailers like HomeGoods.

"Everyone is offering low-priced furniture today imported from Asia or India", said bankruptcy attorney Kenneth Rosen of Lowenstein Sandler.

Sales in its most recent quarter fell 13 percent to $358 million as store traffic dropped.

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