Pier 1 files bankruptcy, seeks buyer
FORT WORTH, Texas – The home furnishings and décor retailer Pier 1 Imports announced Monday, Feb. 17, that it had filed Chapter 11 bankruptcy and was working to find a buyer for the company.
The news was expected as the company announced last month that it was closing up to 450 storefronts as it deals with continued poor financials.
Pier 1 has entered into a Plan Support Agreement (PSA) with a majority of its term loan lenders and filed voluntary Chapter 11 proceedings in the U.S. Bankruptcy Court for the Eastern District of Virginia. It anticipates that court-approved bids to buy the company will be due by March 23.
Pier 1 CEO and Chief Financial Officer Robert Riesbeck said in a statement that bankruptcy will “provide Pier 1 with additional time and financial flexibility as we now work to unlock additional value for our stakeholders through a sale of the company.” He said the company is “pleased with the initial interest as we engage in discussions with potential buyers.”
The retailer currently operates 936 stores, including four Delaware locations: Wilmington, Newark, Dover and Rehoboth Beach. It has already confirmed that the Dover location will close amid plans to shutter about half of its stores, including all in Canada.
The company also announced that it would close certain distribution centers and reduce its corporate expenses, including through layoffs.
The third quarter report was just the latest drop in the bucket for Pier 1, which was founded in San Mateo, California, in 1962.
The company, like many retailers, has struggled to survive in the era of e-commerce. It reported a net loss of almost $59 million through the first three quarters of 2019
In November, Riesbeck was promoted to CEO from his position as chief financial officer. Riesbeck was previously involved as an executive with bankruptcy filings at plus-size clothing retailer FullBeauty and electronics and appliance retailer HHGregg.
The company’s stock is already trading at less than 40% of its value from before announcing its sweeping store closures. It wasn’t immediately hit by another round of stock sell-off, however, as markets were closed Monday for Presidents Day.
By Jacob Owens