In a significant move impacting the global tech and defence sectors, former US President Donald Trump has issued an executive order to dismantle a multi-million dollar computer chips deal. The order, issued on Friday, mandates the Chinese-owned HieFo Corporation to divest its recently acquired semiconductor technology, citing grave concerns over US national security.
The Deal Under Scrutiny: From Obscurity to Spotlight
The transaction in question had flown largely under the radar when it was first announced back in May 2024 during the Biden administration. It involved Emcore Corp, a specialist in aerospace and defence, selling its computer chips and wafer fabrication operations to HieFo Corp for $2.92 million. This price also included HieFo assuming approximately $1 million in liabilities. The deal was completed with little public attention until President Trump's recent intervention cast a harsh spotlight on its potential implications.
Trump's Order and the "Credible Evidence"
The executive order from President Trump is direct and uncompromising. It demands that HieFo completely divest the sensitive technology it acquired from Emcore within a strict deadline of 180 days. The justification provided is based on what the order describes as "credible evidence" that HieFo's current owner is a citizen of the People's Republic of China. This foreign ownership, according to the US administration, poses an unacceptable risk to American security interests if control of the advanced chip technology remains with HieFo.
Who is HieFo Corp and What Were Their Plans?
HieFo Corporation was founded by Genzao Zhang and Harry Moore. Intriguingly, Zhang was previously the vice president of engineering at Emcore before taking on the role of CEO at HieFo. Following the closure of the deal, a press release outlined that the operations and development of the acquired technology would continue to be overseen by largely the same team of employees based in Alhambra, California. Zhang had pledged to leverage the technology to "continue the pursuit of the most innovative and disruptive solutions," with applications pointedly including the field of artificial intelligence.
HieFo has not provided an immediate response to requests for comment regarding President Trump's divestment order. Meanwhile, Emcore, which was a publicly traded company at the time of the sale, was taken private last year by the investment firm Charlesbank Capital Partners.
This action underscores the ongoing and intense scrutiny over foreign, particularly Chinese, investment in critical and dual-use technologies within the United States. The forced unwinding of this deal signals a continued hardline stance on protecting technological assets deemed vital to national security, potentially chilling similar cross-border transactions in the semiconductor sector.
