Bankrupt Pier 1 Draws Last Breath as Liquidation Plan Approved

Home furnishing retailer Pier 1 Imports Inc. won bankruptcy court approval of its liquidation plan after the pandemic dashed its hopes of reorganizing.

Administrative expense claims holders would recover more than 40% under the the plan, approved Thursday by Judge Kevin R. Huennekens of the U.S. Bankruptcy Court for the Eastern District of Virginia.

The company’s unsecured creditors won’t receive any money for their claims. But the plan releases them from potential liability for about $80 million for preference actions—suits to recover money from particular creditors that was paid within 90 days before the bankruptcy filing—the unsecured creditors committee said in a July 29 statement.

Pier 1’s shareholders won’t receive anything in the liquidation.

The retailer filed Chapter 11 in February, but abandoned its plan to reorganize or sell as a going concern after Covid-19 shuttered its doors. The bankruptcy court in May allowed the company to conduct going-out-of-business sales and wind down its affairs.

Pier 1 sold its distribution center in Texas earlier this month for $18 million after a bankruptcy auction.

The case is In re Pier 1 Imports, Inc., Bankr. E.D. Va., No. 20-30805, confirmation order 7/30/20.