A bankruptcy court judge has approved Pier 1 Imports’ plan to completely wind down its operations, sealing the demise of the home furnishing company after 58 years in business.
As part of the plan, Pier I will begin an “orderly liquidation” of its remaining stores as soon as reasonably possible after the stores reopen with the easing of coronavirus lockdowns. It will also seek to sell all remaining assets including its intellectual property and e-commerce business.
“This is not the outcome we hoped for when we began [the Chapter 11] process, and we are deeply saddened to move forward with winding down Pier 1,” CEO Robert Riesbeck said in a news release.
Pier 1 filed Chapter 11 in February to facilitate a sale of the company. Its revenue had declined for nine consecutive quarters and it was struggling to service a long-term debt load of more than $250 million amid changing consumer tastes and competition from big-box rivals and online retailers.
“The global pandemic upended these plans, completely derailing all efforts to secure a going-concern bidder and upending the financial models underpinning the going-concern debt-for-equity exchange” contemplated by Pier 1’s agreement with lenders, the company said on May 19 in its motion for a court order authorizing the wind-down.
“The effects of the COVID-19 pandemic have proven insurmountable,” it said.
At the time of the Chapter 11 filing, Pier 1 was planning to shut roughly half of its locations, or about 450 shops, permanently. It expects to conclude liquidation proceedings and shut down for good by the end of October.
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