More than a year ago, Apple’s sapphire supplier GT Advanced Tech announced that it was filing for bankruptcy under Chapter 11, with the company parting ways with Apple as part of the restructuring. Despite the parting being amicable, GT still was in debt $439 million. Today, however, The Wall Street Journal reports that GT and Apple have come to an agreement on how to pay off that debt.
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According to documents filed in the U.S. Bankruptcy Court, GT Advanced Tech will auction off the sapphire manufacturing equipment it acquired while constructing its operations to build sapphire displays for Apple. GT will keep up to 600 furnaces as part of the agreement, while all unsold items will go to Apple. GT had originally revealed more than a year ago that it planned to sell the furnaces from its Arizona plant, but it was unable to do so, forcing it to turn to this auction idea.
The items that Apple receives will be disposed of. The company will then erase the loan it gave to GT when the partnership was originally constructed. The earnings from the auction itself will be split between GT and Apple.
Earlier this year, GT Advanced cut another 40 percent of its workforce after initially laying off 700 workers when it announced its bankruptcy.
Before GT and Apple can move on with the auction, a bankruptcy judge must sign off on the plan.