The sudden collapse of GT Advanced Technologies surprised everyone last week, including Apple, but according to new info obtained by the Wall Street Journal, key executives at GTAT knew its sapphire production deal was in trouble as early as February of this year.
Apple’s third payment of $103 million, which was due in February, wasn’t paid to GTAT on time according security filings which reveal GTAT faced sapphire production problems just months after inking its exclusive deal with Apple.
“The third payment, of $103 million, was due in February, but Apple did not make it until April, according to GT’s securities filings. The final installment of $139 million was due in April, according to a GT securities filing. In August, GT said it expected the payment by October. But Apple never made the payment, because GT did not meet certain requirements, according to people familiar with the matter.”
After the production issues started and Apple didn’t make its payment, GTAT’s COO and point man at the Mesa, AZ plant, Daniel Squiller, sold $1.2 million shares of his stock in May. Squiller, who was transfered to Mesa from Hong Kong, sold 116,000 GTAT shares between $15.88 and $20.08 and then created a plan to sell off $750,000 more shares over the next few months.
Squiller didn’t manage to sell off all of his shares though, as he still holds a 232,735 share stake in GTAT, even though their value has plummeted to just 43 cents a share as of October 14th.
GTAT’s CEO also ditched his shares leading up to the Apple event, netting a whopping $10 million over the course of a few months. The stock’s value immediately tanked after Apple’s keynote on October 9th, when investors realized the iPhone 6 doesn’t use GTAT’s sapphire glass displays.
Source: Wall Street Journal