Apple, GT Advanced Officially Part Ways
After a protracted relationship that churned out no physical product from their famed Arizona facility, GT Advanced and Apple have parted ways. The separation is said to be amicable, and comes on the heels of GT's bankruptcy and subsequent bashing of their deal with Apple. Calling the arrangement "oppressive", GT failed to meet thresholds for getting the facility up and running, which led Apple to hold back payments in their $500 million deal. Now, GT Advanced will need to sell off equipment to pay Apple.
Though we don't learn much about what the two parties agreed to, we do find that GT will have to sell two furnaces meant to heat the resilient Sapphire glass to satisfy their Apple agreement. The deal still has tens of millions of dollars hanging in the air, which is what prompted the bankruptcy in the first place.
The sale of the furnaces will see money routed to Apple, which has both parties agreeing is a fair settlement. This split will also give GT time to throttle down their operation in Arizona, and pay severance incentives to employees.
The split also leaves no loose ends, as GT has agreed that no further action against Apple will be taken. In condemning the deal with Apple, GT's CEO said they would pursue legal action against the iPhone maker in the future.
This leaves Apple looking for a new partner to produce Sapphire glass for upcoming devices. It's not clear if Apple will pursue operations at the Arizona facility, but whoever GT sells those furnaces to might be a strong contender to replace them for iPhone display manufacturing supremacy.
Source: Street Insider