The Wall Street Journal reports Apple and GT Advanced Technologies have reached a deal to dissolve their partnership. Under the terms of the deal, GT Advanced will sell more than 2,000 sapphire furnaces, with some of the proceeds going to Apple to pay off the $440 million the company loaned GT to purchase the sapphire making equipment.
WSJ, via MacRumors:
Mr. Despins said the proposed settlement allows GT Advanced to try to sell the furnaces at the Mesa, Ariz. sapphire-manufacturing facility, and give the money to Apple, which financed the equipment. GT Advanced would surrender its claims against Apple, under the deal, and agree not to disparage the technology giant, Mr. Despins said.
Both companies have also agreed to file a revised explanation for GT’s bankruptcy filing, which will be submitted to the court at a November 25 hearing. The original court papers remain sealed. The settlement would see original court papers stricken form the record, keeping any information about what went wrong between the two companies away from public eyes.
While there was some speculation that Apple might take over the sapphire production operation, it appears GT will be selling off all of the furnaces to other parties. This leaves any plans Apple might have for expanded future use of sapphire in its products somewhat up in the air.
Rumors have suggested GT began missing milestones in its agreement with Apple as early as February of this year. GT’s failure to produce acceptable sapphire glass led to Apple’s withholding of a final $139 million loan payment, which led to GT Advanced’s filing for Chapter 11 bankruptcy protection in early October.
GT plans to begin winding down sapphire plant operations in the near future, eliminating 727 jobs by the time everything is shut down.
