By LU Keyan

New East New Materials, a Zhejiang-based maker of printing ink and adhesives, said on Sunday night that it plans to buy a majority shareholding in TD Tech for 2.1 billion yuan (US$310 million) from Nokia.

New East shares went limit-up Friday, as the market had seen some signs of what was to come. New East shares also came crashing back down to earth on Monday as a raging Huawei released a statement leaving no room for doubt as to its position: Huawei finds the deal utterly intolerable.

TD Tech is a JV between Nokia and Huawei that makes phones almost indistinguishable from Huawei’s own.  Nokia held 51 percent of the company and Huawei the rest.

A statement today from Huawei took a rare tough tone. Huawei “agrees with Nokia’s sale of equity, but insists that the purchaser has the same capabilities to continue with the operation. Our company does not intend to operate TD Tech with New Oriental New Materials jointly.”

With “absolutely no chance” of working with New East, the company may take further action, including selling out or buying out TD Tech, or ending the licensing of technology to TD Tech. Huawei also said it respects Nokia’s decision to sell the shares, but New East is a chemical product manufacturer without experience in the tech industry.

TD Tech is deeply connected with Huawei, a number of its directors are also senior Huawei executives, including rotating president XU Zhijun.

New East expects the company's profit to drop as much as 71 percent in 2022 to 15.75 million yuan.