Apple Settles With Failed Sapphire Supplier GT Advanced For $439 Million
The settlement provides relief from the $439 million in debt GTAT accumulated when it was gung-ho to build sapphire glass material for Apple. Come November 23, GTAT will auction off various assets and then divide the proceeds.
A furnace used for making sapphire glass material
Not everything GTAT owns will be auctioned off. The company plans to hold onto several hundred furnaces used for making sapphire glass material. Everything else will either be sold off or end up in the hands of Apple, which will take possession of whatever equipment is leftover. Apple will then scrap the parts and nullify the loan it made to GT.
This is the conclusion of a yearlong effort by GTAT to sell off assets and get out form under Apple's hefty loan, which ultimately prompted a chapter 11 filing. Had things gone differently, GTAT would be sitting pretty as a supplier of sapphire glass material to Apple, which is what both companies originally wanted to happen.
GTAT maintains that Apple kept changing the specifications for its order of sapphire glass, while Apple claims GTAT simply failed to live up to its end of the bargain. Either way, the deal fell apart and this is the end result.