“One day before Apple announced that its new iPhones would not use sapphire screens made by GT Advanced Technologies [GTAT], the supplier’s chief executive sold more than 9,000 shares of GT stock, for $160,000,” Daisuke Wakabayashi reports for The Wall Street Journal.
“GT CEO Thomas Gutierrez sold the shares Sept. 8 at an average price of $17.38,” Wakabayashi reports. “The next day, after Apple’s announcement, GT shares fell 13% to $14.94. Monday, GT filed for bankruptcy protection, sending its shares down 93% to 80 cents.”
“In a filing, GT said Gutierrez’s share sale was part of a pre-arranged plan put in place on March 14, 2014. But there was no obvious pattern to his sales,” Wakabayashi reports. “Gutierrez didn’t sell any shares in 2013. This year, he’s sold nearly 700,000 shares since February, valued at more than $10 million.”
Read more in the full article here.
MacDailyNews Take: Of course, at the very same event, Apple did unveil Apple Watch and Apple Watch Edition, both of which feature sapphire crystal displays.
(Apple Watch Sport, the model where weight is most important, instead features a lightweight strengthened Ion-X glass display.)
Related articles:
Law firms launch investigations into possible violations of federal securities laws by GT Advanced – October 7, 2014
Analyst: Apple may take possession of sapphire furnaces from GT Advanced – October 7, 2014
Apple to provide debtor in possession financing to GT Advanced? – October 7, 2014
Investors stunned over GT Advanced bankruptcy filing – October 7, 2014
GT Advanced files for chapter 11 bankruptcy court protection – October 6, 2014
Apple and GT Advanced rampup sapphire production in Mesa – August 11, 2014
GT Advanced expects sales of sapphire production tools to boost profit; shares surge – August 5, 2014
Apple and GT Advanced open second sapphire plant in Salem, Massachusetts – June 19, 2014
Apple patents method for embedding sapphire displays in LiquidMetal device chassis – May 27, 2014
If it quacks like a duck……
What does a duck look and sound like? Serious question.
The first question that should be asked is how much stock did he own and how much does he still own? If he sold 5% of his shares for a valid reason (buy a house), then no problem. But if he sold 30% of his shares for no apparent reason, then I call foul.
2¢
You mean fowl?
never mind, he is a quack
You honestly don’t know what a duck looks or sounds like? Seriously?
Christ, the education system must be even more fucked-up than I thought!
Yeah, because foreign students spend years learning how animals, such as ducks, sound.
They graduate the equivalent of high school, when they major in crow speak, a skill in high demand with employers, by the way,
It looks like Gutierrez financially benefitted from two important bits of information not available to the general public. To my knowledge, that is a crime.
Agreed.
Hopefully the government investigates, and not just private attorneys. For whatever good it’ll do …
Well, unless you are a congress critter of course. Then it’s perfectly legal.
It’s not a crime if he properly filed with the SEC stating he would be selling his shares at a pre-determined date. The stock price shot up over the past year. Why wouldn’t a CEO of a small company which struck gold want to cash in some shares for some actual cash?
Interesting “if”, Bizlaw. However, as CEO, his first priority is to serve the needs of the shareholders. As such, he is directly answerable to the Board of Directors, who represent the shareholders. If the company was going to go bankrupt, it was his obligation—MANY months ago—to give a public heads-up that the company is financially distressed.
The chances are absolutely zero that he learned the company had to go bankrupt, and filed for bankruptcy all in the same day… and conveniently after he was scheduled to sell his stock.
So even if he had filed with the SEC, he was sitting on information that only himself and certain insiders were privy to and withheld the info from the public. All for personal gain.
That too would be illegal. Highly.
Coincidentally, the day before they file bankruptcy and the stock crashes. How lucky can you be.
Also, didn’t Apple pay to build the factory in Arizona?
Apple owns the land and the factory. GTAT is just leasing it. All of GTAT’s furnaces and equipment were put up as collateral. Apple basically agreed to loan them $500million (in installments) for exclusive rights to potentially buy GTAT sapphire, or not buy it. A loan that they can collect at any time for any reason.
Meaning that GTAT made the worst deal possible, and either Apple deliberately screwed them or they did something to piss off Apple and they sent Tim’s cousin Vinny to collect debts and break kneecaps.
Wrong. GTAT would have had to put up all of its property as collateral if it borrowed money from a bank. If it got venture capital money, it would have had to give up a controlling interest (or more) in the company.
Apple’s deal was actually very favorable — low terms, and GTAT basically locked Apple to itself as a customer with a huge interest in GTAT succeeding with the potential for massive orders once the factory was up and running.
This must be one of those “Makers” that First 2014, Then 2016
is talking about
shhhhhhhhh
might awaken the midget
Yes, sapphire is twice heavier than glass, however, Apple uses super-thin layer over regular glass, so actual reason is price, not weight.
Based on the limited info in the headline, he sounds very guilty. But then you see that the sale was a whopping 1.3% of his sales for the year, and before an event that announced something positive for his company, and you have to ask:
Where’s the beef?
I think he just reads what we all write about here: Sell on rumor, buy on news! We all know the price climbs prior to an Apple announcement and tanks during/afterwards.
160 grand is enough for a down payment on a trailer home in London. Hope he thinks it was worth it.
Gee, wish I had that inside information. I bought 50 shares at around $18 a share. Needless to say, I lost my shirt on this one. Bastards.
Everything stinks with GTAT. I think Apple made a rotten deal.