(Yicai Global) April 10 -- Shares of New East New Materials plunged by the exchange-imposed limit after telecoms giant Huawei Technologies said it is unwilling to cooperate with the Chinese ink and adhesive products maker that intends to buy Nokia’s stake in their joint venture.

New East New Materials [SHA: 603110] closed down 10 percent at CNY40.02 (USD5.83) a share today. The stock has climbed 18 percent since the beginning of the year, but was volatile in the past few trading days, tumbling 10 percent on April 6 and gaining by the same the day after. 

Huawei is unwilling to cooperate with the buyer of Nokia’s stake in TD Tech, its JV with the Finnish telecoms company, because New East New Materials has inadequate capabilities in the communications industry, the Shenzhen-based firm said late yesterday.

New East New Materials announced yesterday that it would buy Nokia’s 51 percent stake in TD Tech for CNY2.1 billion (USD309 million) to expand its main business into wireless communication technology products.

Huawei is assessing the situation and considering its options, including but not limited to exercising the right of first refusal for the JV’s shares or selling its stake in the JV, thereby ending the technology grants to TD Tech and its subsidiaries, it added.

TD Tech’s units research, develop, and sell wireless communication products, terminals, and internet of things module products and provide related services. It has many well-known Chinese and international clients, according to New East New Materials’ acquisition report.

Editor: Futura Costaglione