The Danish retail magnate who recently disclosed a 9.9% stake in Pier 1 Imports ( PIR) is no longer a passive investor.

Pier 1 said Monday it struck a deal to sell its U.K.-based Pier Retail Group to Palli Ltd. for about $15 million. Palli is a unit of Lagerinn ehf, an Icelandic corporation owned by Jakup a Dul Jacobsen. Jacobsen franchises Jysk stores (pronounced yoo-sk), a home-furnishings chain that's known as the Danish version of IKEA and has 1,000 stores worldwide.

When Jacobsen disclosed his stake in Pier 1 last month , its shares jumped 6.6% in one day on speculation he was planning a takeover bid in order to get a bigger foothold in the U.S. retail market. Monday's announcement adds no credibility to the speculation, but it does show that Jacobsen has been in direct negotiations with the company's management.

"He's clearly having real discussions with Pier 1's management and its board to buy a part of the business," says Sanford Bernstein analyst Colin McGranahan. "Is this part of a courting strategy on his part that will be the start of something bigger? That remains to be seen, but I doubt this is all he wanted. It doesn't make sense to invest $100 million in a stake to buy a $15 million business."

U.S. investors may remember Jacobsen as the man who bought a stake in Linens 'n Things ( LIN) shortly before it agreed to be acquired by a private equity group. Some have concluded that his plans to cheaply acquire a U.S.-based home-furnishings chain were thwarted in that instance, and Pier 1 has become his new target.

Pier 1 is selling a chain of 40 stores in the U.K. and Ireland that McGranahan says is losing money and posting negative same-store sales figures. The price represents the poor performance of the business. Pier 1 said it recorded a pretax impairment charge of approximately $7 million for its fourth quarter to represent the fair value of its investment in the business.

Misty Otto, a spokeswoman with Pier 1, declined to comment further on the sale to Jacobsen.

" Jacobsen is definitely opportunistic," McGranahan says. "He's buying this subsidiary on the cheap."

Meanwhile, shares of Pier 1 have declined about 50% over the last two years as its sales and earnings have consistently slowed and disappointed Wall Street. So far this year, the stock has shown some signs of life after dipping below $9 in December. Despite a dreary holiday performance, shares are now up over 30% for 2006, and with a major merchandise overhaul in the works, investors are starting to look at it as a glass-half-full situation.

The valuation attracted legendary investor Warren Buffett, whose Berkshire Hathaway ( BRK.A) disclosed a 9% stake in 2004. Buffett cut his stake in half as the retailer floundered, and Berkshire now owns about 3 million shares.

In February, Jacobsen indicated he was a passive investor in a regulatory filing that disclosed his stake in the company. If he engages Pier 1 in any negotations related to a takeover of the company, he would be required to disclose that publicly.

"At this point, Jacobsen remains an enigma," McGranahan says (he doesn't own the stock and his firm has no investment banking relationship with the company).

Shares of Pier 1 recently were down 32 cents, or 2.7%, to $11.30.