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Apple Objects to GT Advanced's Financing Plan Following Mesa Fire

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Original poster
Apr 12, 2001
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Apple is objecting to GT Advanced Technologies' financing plan over concerns that it would undermine its existing settlement reached with the bankrupt sapphire crystal supplier last year, reports Re/code. GT Advanced reached a settlement with Apple in October 2014 after failing to produce sapphire crystal of the quality desired by the Cupertino-based company for potential use in future products.


GT Advanced is attempting to restructure by raising $95 million through a loan agreement under the supervision of the U.S. Bankruptcy Court for New Hampshire, but the financing plan is contingent upon the company receiving enough insurance money to repair any damage to sapphire furnaces following a fire at its former Mesa, Arizona facility a few months ago.

GT Advanced's inspection equipment damaged in Mesa facility fire last May

Apple argues that GT Advanced already determined damage at the facility to be minimal, adding that the terms of the loan agreement give lenders too much leverage to foreclose on the sapphire furnaces that GT Advanced is supposed to sell in order to repay Apple. A group of GT Advanced shareholders have also reportedly questioned why the company needs to raise money nine months into bankruptcy.

GT Advanced filed for bankruptcy last October after it became clear the company was spending over one million dollars per day to run its operations, despite being unable to produce sapphire acceptably by Apple's standards. The company began winding down its sapphire production and decommissioning the furnaces to prepare them for storage and resale through the end of last year.

Article Link: Apple Objects to GT Advanced's Financing Plan Following Mesa Fire
 

bwillwall

macrumors 6502a
Dec 24, 2009
782
372
smh this company... I can't even believe how shady they are and how poor of decisions they seem to make.
 
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SteveBlobs

macrumors member
Jan 29, 2013
85
149
This is such an interesting story. I really wish someone would do an in depth investigative report on it. For a could years there were so many rumor/news stories about how sapphire was going to be the best thing since sliced bread. When Apple contracted with this company the stories talked about how this was such a game change and that Samsung and other phone makers were going to be years behind the curve on sapphire.

Then seemingly over night Apple pulls its contract and GT declares bankrucy. Then stories come out about how the executives of GT dumped their stocks only weeks earlier. Then, after seemingly after all is lost, Apple announces they're going to repurpose the facilities. Now this fire.

I'm not arguing a conspiracy theory, but I feel like there have been so many interesting twists in the story that it really deserves an in depth look at what really happened here.
 
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Geniva

macrumors newbie
Feb 17, 2011
14
1
So now Apple is negotiating on GT's behalf in order to stop GT from signing off on a terrible loan deal.
 
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bbeagle

macrumors 68040
Oct 19, 2010
3,419
2,683
Buffalo, NY
Apple's contract to buy GT's equipment and facilities might be null and void because of the bankruptcy filing.

Say, I have $1,000,000 in debt and I sell my 3 yachts to someone for $500,000. Then I declare bankruptcy. According to the law in the United States, I can't give up my property and then declare bankruptcy - this is fraud. The other debtors want their share of the bankruptcy estate (which the yachts were part of. Any transactions in the prior 2 years are looked into and can all be taken back.
 
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tbrinkma

macrumors 68000
Apr 24, 2006
1,651
93
Apple's contract to buy GT's equipment and facilities might be null and void because of the bankruptcy filing.

Say, I have $1,000,000 in debt and I sell my 3 yachts to someone for $500,000. Then I declare bankruptcy. According to the law in the United States, I can't give up my property and then declare bankruptcy - this is fraud. The other debtors want their share of the bankruptcy estate (which the yachts were part of. Any transactions in the prior 2 years are looked into and can all be taken back.

Apples contract to buy GT's equipment is *part* of the bankruptcy. It is how Apple is going to be able to recover their investment. Trying to get a loan which uses that same equipment as collateral *after* agreeing to sell them to Apple during the bankruptcy proceedings is more than a little shady.
 
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tongxinshe

macrumors 6502a
Feb 24, 2008
854
390
<Quote>A group of GT Advanced shareholders have also reportedly questioned why the company needs to raise money nine months into bankruptcy.</Quote>

The company did declare bankruptcy, but until the last moment of this company's official death, the company can sacrifice anything but never the executives' luxury habit on the company's expense! That's the basic rule of the US companies, how could you not know this basic rule before doing the investment?!!!
 
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boodle

macrumors regular
Jun 12, 2004
145
112
What the actual? This is like a bad gangster movie or something.
 
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Benjamin Frost

Suspended
May 9, 2015
2,405
4,999
London, England
Then seemingly over night Apple pulls its contract and GT declares bankrucy. Then stories come out about how the executives of GT dumped their stocks only weeks earlier. Then, after seemingly after all is lost, Apple announces they're going to repurpose the facilities. Now this fire.

I'm not arguing a conspiracy theory, but I feel like there have been so many interesting twists in the story that it really deserves an in depth look at what really happened here.

Yep.

Intriguing story, seemingly.
 
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Thunderhawks

Suspended
Feb 17, 2009
4,057
2,118
This is such an interesting story. I really wish someone would do an in depth investigative report on it. For a could years there were so many rumor/news stories about how sapphire was going to be the best thing since sliced bread. When Apple contracted with this company the stories talked about how this was such a game change and that Samsung and other phone makers were going to be years behind the curve on sapphire.

Then seemingly over night Apple pulls its contract and GT declares bankrucy. Then stories come out about how the executives of GT dumped their stocks only weeks earlier. Then, after seemingly after all is lost, Apple announces they're going to repurpose the facilities. Now this fire.

I'm not arguing a conspiracy theory, but I feel like there have been so many interesting twists in the story that it really deserves an in depth look at what really happened here.

Movie by SONY: SAF FIRE with GT Villains: Anthony Hopkins, Hans Gruber , Jack Nicholson
 
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ctdonath

macrumors 65832
Mar 11, 2009
1,504
485
I wonder if Apple is on this somehow

Not a chance. Surely Apple knows they're incredibly high-profile, and any downright criminal action on their part would have devastating consequences. I know it's popular to attribute violent malice to the very rich (individuals or corporations), but such memes are absurd as there's too much to lose over too little gain, even if that gain is huge by mundane standards. Apple just wanted a leading-edge sapphire factory, and is just trying to make the best of a failed situation thru normal hard bargaining.
 
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Saucesome2000

macrumors 6502
Dec 10, 2014
338
319
Nashville, TN
"A group of GT Advanced shareholders have also reportedly questioned why the company needs to raise money nine months into bankruptcy."

I am in no way a financial expert or bankruptcy lawyer, but this was the most telling part of the article to me.
 
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pubwvj

macrumors 68000
Oct 1, 2004
1,896
200
Mountains of Vermont
Court in "New Hampshire"???

Why? Seems like a long ways from Arizona and California. Shopping around much? Funny part on that is the local newspaper articles here in New England say that New Hampshire's courts are over booked.
 
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RogerWilco

macrumors 6502a
Jul 29, 2011
758
1,245
This is such an interesting story. I really wish someone would do an in depth investigative report on it.
Almost as interesting as the "We cracked it" TV stories, and the Apple Car factory stories, and the...

Of course none of this was intended to manipulate gullible press whores or feed the buzz machine that keeps the AAPL share price levitated, no that's just conspiracy talk.
 
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uwdude

macrumors 6502a
Jul 16, 2014
915
468
This story seemingly has no end. 5 years from now, we'll be hearing about how GT has managed to extend the bankruptcy proceedings one more time, by making tens of millions of dollars disappear somehow from the original loan, and trying to re-finance the loan.
 
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ProjectManager101

Suspended
Jul 12, 2015
458
719
In project management there is a simple formula: quality = resources x time. If you want certain quality you need certain resources and certain amount of time. These people offered a quality, signed a contract to have it delivered at certain time but they didn't have the resources ready. In the world there are people who knows how to sell themselves very well and they are equally talented in making up excuses and pointing fingers when they do not deliver.

I knew this company was not able to deliver once I saw the smile of the owners after signing with Apple, there is this particular facial expression in people who are liars and are there for the money. Apple has been too kind with these people.
 
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Even Longer

macrumors 6502
Dec 12, 2012
466
389
Head of a pin
Random events - very much like the FTL, but with GTA (GT Advanced :)) and without that cozy retro graphics...
 
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LordVic

macrumors 603
Sep 7, 2011
5,561
12,091
In project management there is a simple formula: quality = resources x time. If you want certain quality you need certain resources and certain amount of time. These people offered a quality, signed a contract to have it delivered at certain time but they didn't have the resources ready. In the world there are people who knows how to sell themselves very well and they are equally talented in making up excuses and pointing fingers when they do not deliver.

I knew this company was not able to deliver once I saw the smile of the owners after signing with Apple, there is this particular facial expression in people who are liars and are there for the money. Apple has been too kind with these people.


as a resource, Project managers never give us enough time :p


but yes, I agree with you
 
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