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Apple's Sapphire Partner GT Advanced Technologies Files for Bankruptcy

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Apr 12, 2001
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GT Advanced Technolgies, Apple's partner in a sapphire production facility in Arizona, today announced that it is filing for Chapter 11 bankruptcy protection as it seeks to reorganize its businesses. The company remains positive that it will continue to be able to meet its obligations during this time of transition.

gt_advanced_logo_2.jpg
GT indicated that as of September 29, 2014 it had approximately $85 million of cash. In addition, it is now seeking debtor-in-possession financing, which, once obtained, would provide the company with an immediate source of additional funds. These funding sources will enable GT to satisfy the customary obligations associated with the daily operation of its business, including the timely payment of employee wages and other obligations. [...]

"GT has a strong and fundamentally sound underlying business," said Tom Gutierrez, president and chief executive officer of GT. "Today's filing does not mean we are going out of business; rather, it provides us with the opportunity to continue to execute our business plan on a stronger footing, maintain operations of our diversified business, and improve our balance sheet.

"We are convinced that the rehabilitative process of chapter 11 is the best way to reorganize, protect our company and provide a path to our future success. We remain committed to our roots in innovation and our diversification strategy. We plan to continue to operate as a technology leader across our core set of businesses."
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GT's finances have taken a significant hit as it has retooled to support its partnership with Apple, turning its focus to ramping up sapphire production for Apple rather than selling furnaces to other companies. Still, with Apple making a series of pre-payments to GT to help fund the new initiative, the circumstances surrounding the bankruptcy filing are not yet clear.

Apple had been widely expected to include sapphire display covers on at least some iPhone 6 models, but the development did not come to pass. With Apple having no commitment to purchase sapphire from GT, it is possible that an unexpected decision by Apple to omit sapphire from the device put GT into a precarious financial position. Apple is planning to use sapphire on some versions of its upcoming Apple Watch, but it is unclear whether it is indeed sourcing sapphire from GT for the product, and if so, whether the quantities involved would be enough to support GT's investments thus far in the area.

Update 7:47 AM: GT's stock, which was halted prior to the announcement, has resumed trading and is currently down 90 percent.

Article Link: Apple's Sapphire Partner GT Advanced Technologies Files for Bankruptcy
 
Article Link
https://www.macrumors.com/2014/10/06/gt-files-bankruptcy/
maflynn

maflynn

macrumors Haswell
May 3, 2009
73,549
43,512
Wow, that's unexpected :eek:

I wonder what that will do to Apple's plan for the product
 
RandomEnding

RandomEnding

macrumors newbie
Jul 17, 2013
26
22
London
...the circumstances surrounding the bankruptcy filing are not yet clear.

They do, this does not bode well for GT.

However, motorway screens bid to stop rubbernecking by motorists.
 
D

dustinsc

macrumors regular
Nov 21, 2009
230
52
Get ready for a bunch of comments from people who don't understand what Chapter 11 is...
 
jonnysods

jonnysods

macrumors G3
Sep 20, 2006
8,454
6,919
There & Back Again
Maybe they made huge investments in tech trying to get ready for the 6 line of phones, couldn't make it in time and now have no revenue.

Hold out for the 7 boys.
 
azentropy

azentropy

macrumors 601
Jul 19, 2002
4,031
5,403
Surprise
Makes some sense. I'm still thinking the iPhone 6's were supposed to have Sapphire glass displays. With them missing the deadline to be able to mass produce enough it shifted their timeline slightly. Still think it is a viable company and product.
 
F

Fred Stein

macrumors newbie
Sep 22, 2012
15
0
Los Altos CA
Finger print locks everywhere

What if we look at one feature, the sapphire display used for finger print locking. Then ask how many devices could use this. Then ask how many could Apple make? Watches, headphones, home alert systems, door locks, bicycle locks, hi-end cameras MacBooks, camcorders. No predictions, just what if.
 
A MacBook lover

A MacBook lover

Suspended
May 22, 2009
2,011
4,582
D.C.
They are doing this as protection, so they can execute their business plan on better foundation - not because they are going it of business.
 
nooaah

nooaah

macrumors 68000
Sep 3, 2009
1,600
165
Philadelphia, PA
Apple can't even find a sapphire glass partner to file Chapter 12? AAPL is slipping. Selling my shares for $45 a piece. SELL, MORTIMER!
 
0815

0815

macrumors 68000
Jul 9, 2010
1,793
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here and there but not over there
maybe they just use it as a legal way to clear out some/most dept they have and than Apple zooms in and buys them without buying most of the debt (assuming they get court approval for this).

Having worked at two companies that had to file chapter 11, it seems to be a nice way to get rid of dept (one of those companies emerged and was successful afterwards, the other filed for chapter 7 after a year and the assets were sold of at a auction to the main competitioner for cheap - big win for the buyer)
 
Crosscreek

Crosscreek

macrumors 68030
Nov 19, 2013
2,892
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Margarittaville
Start up plants need time to get past initial start up and produce product and get their affairs in order. Chapter 11 allows that. They can then then stabilize their business and production. No worries, it's a smart way to operate and I'm sure Apple is advising.
 
boshii

boshii

macrumors 68040
Jul 6, 2008
3,699
784
Atlanta, GA
I'm sure they were banking on their product being used in the new iPhones and now they can't pay their debts.
 
Col4bin

Col4bin

macrumors 68000
Oct 2, 2011
1,895
1,587
El Segundo
So Apple basically has GT Advanced Technologies sign an exclusive agreement that they will only produce saphire for Apple's rumored iPhones and Apple Watches over the next five years at a high volume capacity, thus limiting GT's partnerships with virtually any other potential clients. Then GT suddely files for Chapter 11 bankruptcy due to not enough business continuity/cash flow.

http://investor.gtat.com/releasedetail.cfm?ReleaseID=804195

Did Apple inadvertantly screw their business partner by having them sign this exclusive contract? Should Apple at least explore a possible buyout of this company or at least license the tech?

Mixed feelings about Apple's business practices at times. :(
 
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