GT Advanced Technologies announced that they will have to close an Arizona plant and will consequently cut no less than 890 jobs. In seems that this is a GT plant that was set to make scratch-resistant screens for Apple. The company claimed that they will pursue legal claims against Apple, while revamping under bankruptcy.
“Only if GT winds down these operations will it be able to stop its mounting losses and re-focus its resources on the operation of its core business of selling sapphire furnaces and other products,” a statement from GT revealed. The company’s statement added that it has many claims against Apple.
“GT believes that it has many claims against Apple arising out of its business relationship with Apple,” it concluded. The company already filed for bankruptcy with the US bankruptcy Court in Manchester, New Hampshire. GT filed for bankruptcy on Monday, providing only few details on the cause of its bankruptcy.
GT Advanced Technologies had a deal with Apple dating back to last year. The two companies agreed to make GT from a supplier of sapphire furnaces to a manufacturer of sapphire for Apple. However, issues raised when Apple announced that the iPhone 6 will use Gorilla Glass and not sapphire.
GT asked the court to end the 13 contracts that the company currently has with Apple, including a confidentially agreement the two companies singed. In fact, this agreement is the reason why GT has been forced to conduct the bankruptcy secretly.
However, the court decided that it would be better to keep the details confidential, this is what the US Bankruptcy Judge Henry Boroff said on Thursday. The judge said that GT Advanced should not divulge the details regarding their issue with Apple.
The problems that GT Advanced has with Apple are not hard to guess, having under consideration that the sapphire business accounts over 75 percent of the revenue of the company. Judge Boroff also asked GT to file for emergency motions, in an attempt to recuperate the production of sapphire components.
It is yet to see what will have and which is the exact situation of GT at the moment.
