GT Advanced Technologies Wind Down Application
With reports of the company’s filing for bankruptcy protection, new updates have been flooding in about the situation with Apple’s manufacturing partner in sapphire glass. This comes after the news that Apple has been trying to keep its partner afloat.
GT Advanced has asked the courts to allow it to “wind down” operations at it manufacturing plant in Massachusetts and Arizona. The manufacturing company has been reported to be filing for motions to get expedited hearings to stop a couple of operations and also, to opt of contracts that pertain to those operations.
The manufacturing facility was purchased and outfitted by Apple but has run for less than a year by GT Advanced. The facility is a place for work for about 700 over employees and was rumored to specifically be used to manufacture sapphire glass specifically for the iPhone 6 variants.
There hasn’t been much to go on for the past few days as GT Advanced has applied for a non-disclosure in its proceedings and is subjected to a confidentiality agreement with a secret third party. If the manufacturing does get out of its contracts, it could still be facing up to USD$50 million in fines due to breach of contract. The company is set to have its day in court today for the wind-down requests.
Apple has only commented that it will be focusing on minimizing the number of employees being retrenched in Arizona and is currently working with officials to figure out the next move it has to make regarding the issue.
In its application to the court, GT Advanced in one filing to get out of contracts blamed the terms of the agreement with Apple to be too “oppressive and burdensome”. The terms were to have been of “no benefit to (GT Advanced’s) estates” and is “not a source of potential value for the company’s future operations, creditors or interest holders…”
Another filing by the manufacturing company handles the whole wind down procedure for the sapphire production facilities. The filing outlines the estate stating that there are furnaces that value about USD$20,000 each at the plant which have sapphire boules being grown in. The boules take 30 days to grow and the filing claims that it is in the interest of the company and its creditors to allow boules already being grown to be completed.
The manufacturing company estimates about 890 employees losing their jobs due to the shutdown and is seeking approval to spend USD$65,000 in incentives. This money will be spent ensuring certain qualified employees remain with the company during the wind down process.