In a significant move regarding national security, President Donald Trump has mandated the termination of a $2.9 million deal involving computer chips, citing risks associated with foreign ownership. The executive order requires HieFo Corp., the current owner of the technology in question, to divest its stake within 180 days. This action emphasizes the growing scrutiny on foreign investments in sensitive technologies, particularly those linked to national security.
The controversial deal was initially inked in May 2024 during President Joe Biden’s administration, involving aerospace and defense company Emcore Corp., which sold its computer chips and wafer fabrication operations to HieFo for $2.92 million. This agreement included the assumption of approximately $1 million in existing liabilities. While the transaction went largely unnoticed at the time, new revelations about HieFo’s ownership have prompted swift action from Trump.
The decision to unwind the deal stems from “credible evidence” indicating that HieFo’s ownership is tied to a citizen of the People’s Republic of China. Founded by Dr. Genzao Zhang and Harry Moore, HieFo’s acquisition plans for Emcore’s technology were reportedly to be managed by the same staff based in Alhambra, California, raising further questions about the oversight of critical technology.
Dr. Zhang, who previously served as vice president of engineering at Emcore, took the helm as CEO of HieFo. In earlier statements following the acquisition, he had expressed his commitment to developing cutting-edge solutions, particularly in fields such as artificial intelligence.
As the situation unfolds, HieFo has yet to respond publicly to President Trump’s directive, which underscores the increasing vigilance exercised by U.S. officials regarding foreign entities controlling key technological assets. The scrutiny surrounding this particular transaction reflects broader concerns within the government about safeguarding American interests in an increasingly competitive global landscape.
This development raises important questions about the future of foreign investments in U.S. technology sectors and the measures being taken to protect national security. As the deadline for divestment approaches, the implications of this order could resonate across the tech industry and influence future dealings that involve foreign ownership of sensitive technologies.
