Apple and its former sapphire supplier GT Advanced have reached an agreement that will allow GT Advanced to absolve itself of the remaining $439 million that it owes Apple, reports The Wall Street Journal.
Under the settlement, GT Advanced will host an auction on November 23 to get rid of the equipment that it contributed to the sapphire making process, with the proceeds being split between the two companies. Equipment that does not sell during the auction will be given to Apple.
While GT intends to hang on to some of the equipment--as many as 600 sapphire-making furnaces--it is prepared to auction what it can and abandon what it can't cart off, court papers say.
Anything not sold will be handed over to Apple, which has agreed to scrap the equipment and extinguish the loan it made to transform GT from an equipment manufacturer into a supplier of smartphone-screen material.
Following the dissolution of the relationship between GT Advanced and Apple, GT Advanced agreed to sell off its sapphire furnaces to repay the loan Apple had provided to buy the equipment in the first place. Over the course of the past year, GT Advanced has been unable to find a buyer for the sapphire furnaces.
GT Advanced and Apple originally partnered up to produce sapphire displays for the iPhone 6 and the iPhone 6s Plus, but the deal soured when GT Advanced was unable to meet deadlines and produce sapphire that met Apple's standards. GT Advanced filed for bankruptcy in October of 2014, laying off more than 700 employees and shuttering the Mesa, Arizona factory, which Apple is repurposing as a data center.
Apple and GT Advanced's new agreement is set to be finalized following the approval of a bankruptcy judge.
Top Rated Comments
All gone to dust. I guess it's all aluminium for the foreseeable future. I wonder if we might see a return to a glass back like the iPhone 4? It was such a fine design.
Well. How wrong I was. :oops:
I'm not sure why you would imply that Apple was "the bad guy." They entered into a business agreement with a company to deliver a product. They even underwrote their expansion. The company never delivered the agreed product, so they terminated the deal. Pretty clear cut and reasonable approach to the situation.
The only tragedy here is the apparent issue with the GT board members getting rich while their company dissolved and 700 employees ended up unemployed.