Pier 1 Imports (PIR) Shares Jump After Withdrawing Proposal to Acquire Cost Plus (CPWM)

June 25, 2008 11:31 AM EDT

Pier 1 Imports Inc. (NYSE: PIR) shares are up $0.64 (+15.88%) today after announcing late last night it has withdrawn the proposal to acquire Cost Plus, Inc. (NASDAQ: CPWM).

The Company stated: "Our goal in pursuing a combination with Cost Plus was to create a stronger, more efficient company. In addition to the significant cost savings, the combination would provide Cost Plus ample balance sheet liquidity and proven merchandising expertise to operate more efficiently in a difficult retail environment.

"We have concluded, however, it is unlikely that we would be able to acquire a majority interest in Cost Plus at a price that would make sense for our shareholders. We continue to believe that, given our highly complementary businesses, the combination of Pier 1 Imports and Cost Plus would create significant value for the stakeholders of both companies."

Today's move is great for investors who purchased shares in the past two days, however, PIR has fallen over 20% in the past 6 trading sessions (including today's gain) and over 41% since May 15, 2008.

Cost Plus shares are down $0.11 (-3.64%) on today's news. In PIR's statement, Cost Plus seemed unwilling to settle for a certain price. However, the entire market cap of CPWM is $65 million and PIR's market cap is $423 million.

Pier 1 Imports, Inc. is a specialty retailer of decorative home furnishings, gifts and related items.[SM]

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