SPRINGFIELD, N.J. —
GE Capital has cut its
credit to Sixth Avenue Electronics and has gone
to federal court to collect $9.6 million in past-due
payments.
The complaint, filed in the U.S. District Court
in Wilmington, Del., charges that Sixth Avenue
defaulted on a $6.4 million payment to GE Capital’s
Commercial Distribution Finance arm (CDF),
which has provided the chain with inventory financing
since 2007.
The GE unit is seeking possession of inventory
and collateral and has suspended the retailer’s
credit facility, court documents show.
Sixth Avenue could not comment on the litigation.
The New Jersey-based A/V chain began a multistate
build-out in 2009 that carried it into Philadelphia
and Delaware, giving it 19 stores at its peak.
But since last month the privately held company
has closed nine locations — including one in West
Paterson, N.J., and a store in Livingston, N.J., last
week
Operations VP Tom Galanis said many of the
closures reflect the chain’s decision to exit the
major appliance business, rendering larger locations,
some with as much as 35,000 square feet,
redundant.
Instead, Sixth Avenue plans to relocate several
stores, including the one in West Paterson, to
smaller, 10,000-square-foot showrooms, Galanis
said.
