Apple Inc. (NASDAQ:AAPL) and sapphire glass manufacturer GT Advanced Technologies Inc (OTCMKTS:GTATQ) are expected to settle and end their relationship on “amicable” terms. Although a judge has not yet approved the proposed settlement, Wall Street went crazy for GTAT on Tuesday, sending shares through the roof.
Apple, GT sign agreement
On Tuesday, it was announced that GT said it will sell its more than 2,000 sapphire furnaces in Mesa, Ariz. and use part of the proceeds from that sale to pay back the debt it owes to Apple. Those furnaces are the ones GT Advanced has been using to make the sapphire glass lenses and screens for Apple’s devices.
At the 2021 SALT New York conference, which was held earlier this week, one of the panels on the main stage discussed the best macro shifts coming out of the pandemic and investing in value amid distress. The panel featured: Todd Lemkin, the chief investment officer of Canyon Partners; Peter Wallach, the managing director and Read More
According to Fortune, Apple has agreed to take a part of the proceeds from the sale of the sapphire furnaces. The amount Apple has agreed to was not disclosed. A GTAT attorney said the arrangement between the two companies is “an amicable parting of the ways.”
Apple may win partial secrecy
When GT filed for bankruptcy earlier this month, it was a shock to Wall Street, and the NASDAQ ended up delisting it. The company’s stock listing was moved to the over-the-counter market.
Apple has been fighting to keep a large amount of documents under wraps while GTAT has been fighting for details of its supplier agreement with the company to be disclosed in court filings. Some details have already come out, like how much GT had to pay Apple for disclosing details about its upcoming products. Also GTAT said it lost $1.5 million a day just to keep its sapphire glass factory up and running.
Under the terms of the proposed agreement, however, some of the documents Apple wants to keep hidden will remain sealed. Some lawyers who were in the courtroom oppose this, arguing that the public should be informed about why GT had to lay off hundreds of workers and why the company’s creditors are being asked to take only a fraction of what it owes to them.
Dow Jones reports that the problem is whether Apple’s right to keep its non-disclosure agreements out of the public eye is more important than the creditors’ and the public’s right to be informed. The judge in the case may side with the public and creditors rather than Apple, however.