Apple may forgive $439 million loan to bankrupted sapphire supplier
We took the time a couple of years ago to visit GT Crystal Systems, a subsidiary of GT Advanced Technologies, to find out how sapphire displays were made. It’s been a long time since we’ve even entertained the thought of an iPhone (or any phone) with a sapphire screen. It’s the same for Apple, too, as it conflict ensued between the company and the now-bankrupt GT Advanced Technologies over providing such screens.
Remember back to when Apple gave a huge loan to GT Advanced in 2014 with the goal of converting its business focus from manufacturing sapphire-crafting equipment to mass-producing sapphire products. GT set up 2,000 sapphire-incubating furnaces at Apple facilities in Mesa, Arizona. Thing was, no one bought anything.
No one even bought the furnaces that GT tried to sell in order to repay Apple’s loan. Faced with a December 31 deadline to clear out of Mesa, the company is going to auction.
With that loan-turned-debt of $439 million, Apple and GT Advanced have come to an accord in U.S. Bankcruptcy Court in New Hampshire regarding auctions that will start on November 23. The resulting pot will be split between GT and Apple.
GT hopes to keep up to 600 furnaces, but it will commit to the auction in good faith and abandon what won’t fit into its trucks. Apple agrees to scrap anything not sold and terminate the loan it made to GT.
A bankruptcy judge needs to sign off on the accord, something GT hopes one will do next week.
Source: Wall Street Journal