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Apple Supplier GT Advanced to shut down operations in Mesa, Arizona

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(Image: Apple watch Sapphire)

(Image: Apple watch sapphire display)

GT Advanced Technologies, the company contracted to supply Apple with sapphire display for the upcoming Apple Watch, petitioned for bankruptcy on Oct. 6, and has approach the court for permission to close down the Mesa, Arizona factory. The troubled supplier also plans to purge 890 jobs in Mesa and its headquarters in New Hampshire, as indicated by court papers.

"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," the company said in a statement on Friday. GT Advanced further revealed that the factory ate up close to $US1 million a day at the operations which it intended to close.

"GT believes that it has many claims against Apple arising out of its business relationship with Apple," the company said in a filing with the U.S. Bankruptcy Court in Manchester, New Hampshire.

City authorities are yet again hit with the job of finding a new tenant to occupy the factory, which is as massive as the size of two-dozen football fields.

In February, Apple and GT Advanced closed an agreement post tax breaks, already built power lines, a fast-tracked building permit and a declaration from the state naming the area as a foreign-trade zone. A nearby utility reached an agreement to build a solar farm in order to supply clean energy to Apple.

By filing for bankruptcy, GT will be able to discontinue the losses that went out of hand on a daily basis, and instead concentrate solely on its core business operations of offering products, such as sapphire heaters. As of now it has no plans to pursue legal claims against iOS manufacturer, Apple Inc. Rather it will depend on its lawful right to end a few assentions it made with Apple that have been putting an undue load on the GT.

Apple, however, has claimed that it has a commitment to holding GT to its agreements and if the company chose to do otherwise, it will be risking Arizona jobs. Apple joined forces with GT to spread out its operations in the state keeping in mind the end goal to meet capacity demands in producing smart watch sapphire displays.

Notwithstanding the operational slow down in Arizona, GT said it will likewise need to wrap up business in Salem, Massachusetts with a specific end goal to subdue the unending stream of cash. The organization is quick to facilitate the procedure, assessing that it could take until the end of 2014 to fulfill this objective.


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