Another GT Advanced executive sold $2M in stock after sapphire deal with Apple began to sour
Scrutiny over beleaguered Apple supplier GT Advanced Technologies continues to grow, with a new report highlighting that another high ranking official at the company sold nearly $2 million in stock after signs of trouble at its sapphire plant began to arise.
The sale of shares by Chief Operating Officer Daniel Squiller came after problems began to spring up at the Mesa, Ariz., sapphire plant, according to The Wall Street Journal. According to the report, the COO sold $1.2 million worth of stock in May, which came after Apple declined to make a final $139 million payment in April. Another $750,000 was sold before the bankruptcy filing.
Apple withheld the payment earlier this year after GT Advanced apparently could not meet its demands for sapphire, a scratch resistant material used on the iPhone and some models of the forthcoming Apple Watch. After Apple declined to make the payment, GT stood with just $85 million in cash as of Sept. 29, days before it filed for bankruptcy.
In all, Squiller sold 116,000 shares of GTAT stock this year worth just shy of $2 million total. He still owns some 230,000 shares that have lost considerable value since his company filed for bankruptcy.
Squiller's sale of GTAT shares is joined by Chief Executive Tom Gutierrez, who sold more than $10 million worth of stock this year. The CEO's sales came to light after it was discovered one transaction — $160,000 worth — occurred on Sept. 8, the day before Apple announced its new iPhone 6 lineup.
Hopeful observers speculated that Apple might include full sapphire screens on the iPhone 6 and iPhone 6 Plus, but the devices only feature the material on the Touch ID fingerprint sensor and rear camera lens. Shares of GTAT immediately began to tumble after the announcement, and plunged more than 90 percent after GT Advanced announced it had filed for bankruptcy last week.
The Journal portrayed Gutierrez's stock sale as suspect, noting that the CEO sold shares with "no obvious pattern." He hadn't sold any shares of GTAT in 2013 before offloading 70,000 this year beginning in May.
Apple's trouble with GT Advanced Technologies started as early as February, when it declined to make a third payment of $103 million. GT eventually received that money in April, but the final $139 million payment was never received.
As part of the bankruptcy proceedings, GT Advanced officials have suggested they feel the terms of their contract with Apple were unfair, going as far as to call the deal "oppressive and burdensome."
The proceedings have also shed some light on Apple's agreements with suppliers, revealing that the iPhone maker imposes a $50 million penalty for every time a partner leaks information about a future product.