After alleging Apple's one-sided contract and unreasonable demands for sapphire drove it to bankruptcy court, GT Advanced Technologies has agreed to a settlement with the iPhone maker. The $439 million settlement seeks to repay a loan Apple lent to GT Advanced Technologies for the production of sapphire furnaces.
GT Advanced Technologies has been buried under $439 million in debt after it failed to hold up its end of a bargain with Apple to make sapphire-based displays for the iPhone 6 series.
The manufacturer alleges that the contract gave Apple too much control and zero obligations. Apple kept elevating its requirements of the operation, till the point that GT Advanced Technologies no longer qualified as a sapphire producer for the iPhone, the manufacturer alleged.
Then Apple left, leaving GT Advanced Technologies with millions of dollars more in equipment than it could use. After a drawn-out dispute in court, during which Apple allegedly told the company to put on its big boy pants, the two sides are on the path to resolution.
Per the terms of the agreement, GT Advanced Technologies will auction off as many of the surplus furnaces as it can. It hopes to keep as many as 600 furnaces, but willing to sell all it can to get from under that mountain of debt, according to the Wall Street Journal.
"Anything not sold will be handed over to Apple, which has agreed to scrap the equipment and extinguish the loan it made to transform GT from an equipment manufacturer into a supplier of smartphone-screen material," the Wall Street Journal reports citing court documents.
GT Advanced Technologies invested $900 million to set up a sapphire production facility in Mesa, Ariz. The manufacturer borrowed $439 million from Apple to see the facility into fruition.
The company now awaits a green light from a bankruptcy judge in order to move forward with the auction, which must occur before Nov. 23, 2015. The company is staring at a Dec. 31 deadline, the last day it has been allotted to move its equipment out.