Apple Inc. signed an agreement with its sapphire supplier GT Advanced Technologies to keep their previous contract a secret, after the “I” company feared information leaks.
On Tuesday, an attorney for the bankrupt GT said the two companies reached an “amicable parting of the ways” pact and as part of the deal Apple has agreed to file a revised explanation for its suppliers shocking bankrupt.
GT, which threatened to release information during its bankruptcy proceedings, according to the settlement will be allowed to wind down its sapphire production factory in Mesa, Arizona, reported Reuters from the court hearing in Springfield, Massachusetts.
Last year Apple was involved in a $578 million prepayment plan for the setting up of GTs production equipment for synthetic sapphire which was needed for Apples screens. However, the tech giants new phones used alkali-aluminosilicate sheet toughened glass or “Gorilla Glass” supplied from Corning Inc.
GTs bankruptcy remains a mystery. Some suggested that Apples decision not to use sapphire screens prompted GTs problems, or the other way around, GTs failure to supply the material forced Apple to change plans.
Under the agreement, GT Advanced will retain intellectual property rights and its more than 2 000 sapphire furnaces inside of the Arizona facility. The company will not make any further claims against Apple. Mr. Luc Despins, an attorney for the debtor, said GT will sell the furnaces and use the proceeds to repay its $439-million debt the tech company, after that no further claims will be made by Apple. The last tranche of the $578-million loan was never paid to GT.
The deal doesn’t “contemplate a continued operation although there could be one in the future,” Mr. Despins said. “The parties will continue to cooperate together on projects but the closing of the Mesa facility will go forward.”
GT has previously requested details of its agreement with Apple to be made public in the interest of creditors and shareholders. However, Apple disagreed and quoted a $50 million penalty, if any information about its contracts and plans leaked, which is included in the GT-Apple supplier agreement.
Apple inc. gained 2.72% on Tuesday and closed at $102.47 on the NASDAQ, marking one-year increase of 37.58%. The company is valued at $597.35 billion. According the CNN Money, the 44 analysts offering 12-month price forecasts for Apple Inc have a median target of $115.00, with a high estimate of $135.00 and a low estimate of $60.00. The median estimate represents a +12.23% increase from the last price of $102.47.
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