Trump Orders HieFo Corp. to Divest $2.9 Million Chip Deal

President Donald Trump has mandated the divestment of a $2.9 million computer chip deal, citing national security concerns regarding the current ownership by HieFo Corp.. This executive order, issued on Friday, underscores the administration’s focus on safeguarding U.S. technological assets from potential foreign threats.

The controversial deal, which was previously announced in May 2024 under President Joe Biden‘s administration, involved Emcore Corp., a specialist in aerospace and defense, selling its computer chips and wafer fabrication operations to HieFo. The transaction included the assumption of approximately $1 million in liabilities, raising eyebrows at the time regarding its implications for U.S. security interests.

Trump’s order stipulates that HieFo must divest from the technology within 180 days. The reasoning behind this urgent directive rests on what Trump described as “credible evidence” indicating that the ownership of HieFo is linked to a citizen of the People’s Republic of China.

HieFo Corp. was co-founded by Dr. Genzao Zhang, who previously served as vice president of engineering at Emcore, and Harry Moore. Zhang, who now holds the position of CEO at HieFo, expressed intentions to advance innovative solutions, particularly in technology aimed at artificial intelligence. A press release following the deal indicated that operations would continue under the same team in Alhambra, California.

As of now, HieFo has not provided a public response to Trump’s order, which has drawn attention to a deal that had previously gone relatively unnoticed. The implications of this order could significantly affect the future of the company and the technological landscape in the U.S., particularly in sectors critical to national security.

Emcore, initially a publicly traded entity, transitioned to private ownership under Charlesbank Capital Partners last year. The shift in ownership and the subsequent scrutiny of the HieFo deal highlights the increasing vigilance around foreign investments in sensitive technology sectors.

As geopolitical tensions remain high, this incident reflects a broader trend of regulatory scrutiny aimed at protecting U.S. interests in technology and defense sectors. The demand for transparency and accountability in such transactions is likely to continue as government officials assess the potential risks associated with foreign ownership of critical technologies.