Home goods retailer Pier 1 Imports Inc. announced Monday it is filing for Chapter 11 bankruptcy protection in the United States, a month after saying it would close all its stores in Canada.
The Fort Worth, Texas-based company, which was founded in 1962 and has 1,000 stores in North America — around 50 of them in Canada — says it is pursuing sale of its U.S. retail locations while under bankruptcy protection, but confirmed all Canadian stores will shut.
Pier 1’s Canadian website now directs customers to a short statement announcing the closures and thanks them for their loyalty.
The company is also commencing creditor protection proceedings in Canada. Osler, Hoskin & Harcourt LLP are serving as Canadian legal advisers.
The company has been struggling with increased competition from online retailers such as Wayfair. Pier 1 has been trying to declutter its stores, improve online sales and draw in younger customers.
Pier 1 said it will conduct a court-supervised sale of the company, with a March 23 deadline to submit bids.
In the meantime, Pier 1 said lenders have committed approximately $256 million US in debtor-in-possession financing so it can continue its U.S. operations during the Chapter 11 proceedings.
Pier 1’s sales fell 13 per cent to $358 million US in its most recent quarter, which ended Nov. 30.
It reported a net loss of $59 million for the quarter as it struggled to draw customers to its stores.
Last month, Pier 1 announced it would close a total of 450 stores. The company is also closing two distribution centres.
In a press release dated Feb.17, the company says it has closed or initiated going-out-of-business sales at more than 400 locations.
It is unknown exactly when the Canadian stores will close their doors and how many jobs will be affected.
