Greek family loads up on Pier 1 shares

By MITCHELL SCHNURMAN

mschnurman@star-telegram.com

Everyone noticed when Warren Buffett took a big stake in Pier 1 Imports. And an investor from Iceland caused quite a stir when he made a play for the retailer a few years later.

But an unknown Greek family has been flying under the radar and steadily buying thousands of shares, sometimes hundreds of thousands — and now has the biggest stake of any Pier 1 investor.

Maria Konstantinu and her three adult children, operating as Greek Investments, have more than 12.3 million shares, about 10.8 percent of the outstanding stock. Their stake is worth almost $54 million.

The buying spree started last spring and continued through last Thursday, when the group reported acquiring another 92,100 shares for $328,000. The Konstantinu family, which has no public profile in the United States, has been adding shares nearly every week rather than buying in large lots when the stock price dips.

The group appears to be a passive investor, saying it’s not trying to change or influence the control of the company. It hasn’t asked for a board seat or made public statements about its intentions, which sometimes happens in these situations.

The returns have already been exceptional, because Pier 1’s stock has climbed sharply this year. Since April 14, when the family reported that it held 4.5 million shares, the price of Pier 1’s stock (ticker: PIR) has more than quadrupled — rising from 96 cents to $4.35 a share at Tuesday’s close.

From April 14 to May 8, when Pier 1 generally traded between $1.50 and $2.20, Greek Investments doubled its stake to more than 9.1 million shares. The exact prices paid for the two initial stakes were not disclosed in regulatory filings, but a back-of-the-envelope estimate shows that Konstantinu is sitting on a gain of more than $20 million.

That’s quite a showing for seven months, and plenty of investors would take some profits off the table at this point. But Greek Investments keeps buying.

In the 27 weeks since mid-May, the family has reported 25 additional buys. They ranged from a few thousand shares to 472,755, generally allowing the investors to accumulate a big stake without spiking the daily volume and driving up prices.

On five occasions, including a few weeks ago, the buys topped 200,000 shares each.

"That’s what you call a vote of confidence," says Stan Block, a finance professor at Texas Christian University. "When you make an investment of this nature and keep adding to it, you’ve got to believe in the company."

Pier 1 has not discussed the Greek investors in public, and a spokeswoman said the company would not talk about its stockholders out of respect for their privacy. She would not even say if Pier 1 executives had talked with the Konstantinu family.

The next largest holder, Jakup a Dul Jacobsen of Iceland, has 8.6 million shares, 30 percent fewer than Konstantinu. Alex Smith, Pier 1’s CEO, bought 25,000 shares in September and reported that he owned 175,000 shares in all.

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