ST. LOUIS, May 24 /PRNewswire-FirstCall/ -- CPI Corp. ("CPI") announced that the waiting period under the Hart-Scott-Rodino Antitrust Improvement Act of 1976, as amended, relating to the proposed acquisition of substantially all of the operating assets of Portrait Corporation of America, Inc. ("PCA"), has expired.
PCA and certain of its direct and indirect subsidiaries are Chapter 11 debtors-in-possession before the United States Bankruptcy Court for the Southern District of New York. On May 4, 2007, PCA filed a motion with the Bankruptcy Court seeking approval of the sale transaction with CPI. The hearing on that motion is scheduled for June 4, 2007. On May 21, 2007, the Official Committee of Unsecured Creditors appointed in PCA's Chapter 11 case filed a statement with the Bankruptcy Court expressing its support for the sale transaction to CPI.
The transaction is expected to close by the end of June 2007. The transaction is subject to certain conditions.
PCA is the sole operator of portrait studios in Wal-Mart stores and supercenters in the U.S., Canada and Mexico. As of April 30, 2007, PCA operates 2,048 studios worldwide, including 1,695 in the U.S. and Puerto Rico, 243 in Canada, 105 in Mexico and 5 in the United Kingdom. During its most recently completed fiscal year ended January 28, 2007, PCA photographed over 5.6 million customers and generated sales of $290 million.
CPI is a portrait photography company offering photography services in the United States, Puerto Rico and Canada through Sears Portrait Studios. The Company also operates searsphotos.com, the vehicle for the Company's customers to archive, share portraits via email and order additional portraits and products.
The statements contained in this press release that are not historical facts are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, and involve risks and uncertainties. We try to identify forward-looking statements by using words such as "expect," "looking ahead," "anticipate," "estimate," "believe," "should," "intend," and other similar expressions. Management wishes to caution the reader that these forward-looking statements, such as our outlook for portrait studios, net income, future cash requirements, cost savings, compliance with debt covenants, valuation allowances, reserves for charges and impairments and capital expenditures, are only predictions or expectations; actual events or results may differ materially as a result of risks facing us. Such risks include, but are not limited to: the Company's dependence on Sears, the approval of our business practices and operations by Sears, the termination, breach or increase of the Company's expenses by Sears or Sears Canada under our license agreements, customer demand for the Company's products and services, manufacturing interruptions, dependence on certain suppliers, competition, dependence on key personnel, fluctuations in operating results, a significant increase in piracy of the Company's photographs, widespread equipment failure, compliance with debt covenants, the impact of the Company's strategic alternative process on its business, implementation of marketing and operating strategies, and other risks as may be described in the Company's filings with the Securities and Exchange Commission, including its Form 10-K for the year ended February 3, 2007. The Company does not undertake any obligations to update any of these forward-looking statements.
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