Washington — U.S. President Donald Trump has ordered a company controlled by a Chinese national to reverse its acquisition of semiconductor assets from a U.S. firm, citing concerns related to national security and sensitive chip technology.
The decision was announced through an executive order issued by the White House on Friday. The order directs HieFo Corporation, a Delaware-incorporated company controlled by a citizen of China, to divest chip-related assets it acquired from U.S.-based Emcore in April 2024. The deal was valued at approximately $2.9 million.
According to the U.S. Treasury Department, the transaction involved digital chips along with wafer design, fabrication, and processing operations, including access to a semiconductor manufacturing facility. Officials said the deal raised concerns about foreign access to critical semiconductor technology and expertise.
U.S. authorities also flagged risks linked to indium phosphide chips, a material used in advanced communication systems, navigation equipment, and defense-related technologies. The Treasury Department warned that shifting the supply or technical knowledge of these chips away from the United States could pose security risks.
The department said the acquisition was not submitted for prior review to the Committee on Foreign Investment in the United States (CFIUS). As a result, the deal was later examined by CFIUS through its non-notified transactions process.
“CFIUS identified national security risks related to potential access to Emcore’s intellectual property, proprietary know-how, and technical expertise,” the Treasury Department said.
Under the order, HieFo must divest all acquired assets within 180 days and immediately restrict access to Emcore’s technical information.
Neither HieFo nor Emcore responded immediately to requests for comment.
Chinese state-linked outlet Global Times criticized the decision, saying it reflected Washington’s growing concern over technology competition with China and lacked sufficient justification.
HieFo had earlier stated that the acquisition would allow continued operations at Emcore’s facility in California and that most key employees had been retained.
Emcore manufactures navigation and sensing equipment used in commercial, industrial, and defense applications. The company was delisted from Nasdaq in early 2025 following its merger with aerospace firm Velocity One LP.
The move highlights increased U.S. scrutiny of foreign investments in sensitive technology sectors, particularly semiconductors, amid ongoing U.S.-China tensions.
