Pier 1 Imports Inc. has filed for bankruptcy with plans to sell the company, less than two months after the troubled home-decor retailer said it planned to close up to 450 stores and cut costs to slow down its cash burn.
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The home furnishings chain has said it filed for chapter 11 protection Monday in the U.S. Bankruptcy Court in Richmond, Va., after warning in January about its ability to stay in business within the next year.
Pier 1 said it intends to conduct a bankruptcy court supervised sale process of the company and complete the sale through a chapter 11 plan. The company said it is in discussions with multiple potential buyers that could acquire the retailer out of bankruptcy.
Pier 1 expects the deadline to submit qualified bids will be on or around March 23, pending court approval.
Before filing, Pier 1 said it entered into an agreement with a majority of its term-loan lenders. The company's lenders have committed to extending $256 million in debtor-in-possession financing. The bankruptcy financing from lenders including Bank of America N.A., Wells Fargo National Association, and Pathlight Capital LP will allow the company to continue operations and conduct its sale process.
"Today's actions are intended to 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," Robert Riesbeck, Pier 1's chief executive, said. "We are moving ahead in this process with the support of our lenders and are pleased with the initial interest as we engage in discussions with potential buyers."