President Donald Trump has ordered a Chinese-controlled company to unwind its purchase of key U.S. chipmaking assets, escalating Washington’s effort to keep advanced semiconductor technology out of foreign hands deemed risky to national security. The decision targets the acquisition of parts of Emcore’s aerospace and defense business by HieFo Corporation and forces the buyer to sell within a tight deadline or face sweeping restrictions. It is a pointed reminder that in the era of strategic competition with China, even relatively small deals can trigger the full weight of U.S. investment screening.
The move, grounded in a formal presidential order and backed by the Committee on Foreign Investment in the United States, reflects growing concern that sensitive chip designs, manufacturing know-how, and specialized equipment could be diverted abroad. By compelling divestment and tightly controlling what happens to the technology in the meantime, the administration is signaling that security considerations now routinely trump commercial logic in the semiconductor sector.
What Trump’s order actually does
At the center of the decision is a presidential directive titled, in full, “REGARDING THE ACQUISITION OF CERTAIN ASSETS OF EMCORE CORPORATION BY HIEFO CORPORATION,” which lays out how the deal must be unwound and what the parties are barred from doing next. The order, issued from The White House, makes clear that the acquisition of CERTAIN ASSETS tied to Emcore’s chip operations cannot stand in its current form and that HieFo’s control over those assets is incompatible with U.S. security interests. By invoking presidential authority over foreign investment, the document elevates what might otherwise look like a niche corporate transaction into a matter of national policy.
The text of the directive, referenced again in a section labeled “REGARDING THE ACQUISITION OF CERTAIN ASSETS OF EMCORE CORPORATION BY HIEFO CORPORATION,” spells out that the president is acting under powers granted to protect the national security of the United States and to respond when foreign control of strategic technology is judged too risky. In that language, the order not only blocks the current structure of the deal but also sets the stage for enforcement, including potential follow-on actions if HieFo fails to comply. The formal framing underscores that this is not a symbolic warning but a binding instruction that the transaction be reversed in practice, as reflected in the detailed provisions highlighted in the executive order text.
How the Emcore–HieFo deal came together
The transaction that is now being dismantled began as a relatively modest sale of specialized semiconductor operations rather than a headline-grabbing mega-merger. Emcore Corp, described as an aerospace and defense specialist, agreed to sell its computer chips and wafer fabrication operations, including facilities and a base of employees in Alhambra, California, to HieFo in a deal valued at about $2.9 million. That arrangement, which involved transferring not just equipment but also staff and know-how, was framed as a way for Emcore Corp to streamline its portfolio and focus on other parts of its business, according to accounts of the Alhambra chip sale.
Earlier in 2024, the two corporations announced HieFo’s acquisition of EMCORE’s digital video and navigation chip assets, a package that included semiconductor technology used in demanding aerospace and defense environments. That announcement, which set the stage for the current clash, made clear that HieFo would gain control over EMCORE’s chipmaking capabilities and related intellectual property, as described in coverage noting that in 2024 the two corporations announced HieFo’s acquisition of EMCORE’s assets tied to digital video and navigation chips. The structure of the deal, highlighted in reporting on how HieFo’s acquisition was initially presented, meant that a foreign-controlled buyer would sit at the center of a supply chain that feeds into sensitive U.S. programs.
Why CFIUS flagged national security risks
The Committee on Foreign Investment in the United States, or CFIUS, reviewed the Emcore–HieFo transaction and concluded that it posed unacceptable national security risks, particularly around the potential exposure of sensitive technology. In a formal statement, officials said CFIUS identified a national security risk arising from the transaction relating to potential access to EMCORE’s intellectual property and other assets that could be used in ways contrary to U.S. interests. That assessment, which underpins the president’s decision, is summarized in a Treasury release explaining that CFIUS identified a national security risk and that the committee’s job is to weigh such risks as a consequence of any given transaction.
More broadly, the Treasury Department’s description of the case underscores how CFIUS now treats semiconductor deals as inherently sensitive when foreign buyers are involved, especially if they are linked to China. The same statement notes that the committee’s review led to a recommendation that the president act, and that the resulting order is part of a broader framework in which CFIUS can require mitigation, restructuring, or outright divestment. The official explanation, contained in the Treasury press release, emphasizes that the committee’s mandate is to protect national security rather than to pass judgment on the commercial merits of a deal, which is why the focus fell on EMCORE’s intellectual property and the risk of its being moved or exploited away from the United States.
The 180-day divestment clock and what it means
Trump’s order does not simply block future steps in the Emcore–HieFo deal, it actively compels HieFo to unwind what it has already acquired. According to the Treasury Department’s description of the decision, HieFo was ordered to divest all acquired assets within 180 days, a timeline that puts immediate pressure on the company to find an acceptable buyer or structure that satisfies U.S. authorities. That requirement, spelled out in a summary noting that HieFo was ordered to divest within that period, means the company must not only sell but also ensure that any new owner is acceptable from a security standpoint.
The same 180 day window appears in detailed coverage of the executive order, which explains that The EO prohibits HieFo from retaining any ownership or rights in the EMCORE assets and gives the company up to 180 days to complete the divestment so that the acquisition, which closed in April 2024, is effectively unwound. Until the divestment is completed, the order restricts HieFo from transferring or relocating the business, and CFIUS is authorized to audit compliance and demand information. Those conditions, described in reporting that notes how The EO prohibits HieFo from retaining rights in the EMCORE assets, are designed to prevent any quiet transfer of technology while the sale process plays out.
Chinese control and the geopolitical backdrop
What makes this case politically charged is not only the technology involved but also who ultimately controls the buyer. Trump ordered a company controlled by a Chinese national to unwind the chip asset deal, a fact that U.S. officials have highlighted as central to their security concerns. The description of the buyer as Chinese-controlled, and the emphasis on its ownership structure, appear in accounts explaining that Trump ordered a company controlled by a Chinese national to divest because of the risk that sensitive chip technology could be moved or accessed in ways that undermine U.S. security.
In public framing of the decision, officials and commentators have repeatedly used the word Chinese to describe HieFo’s ownership and to situate the case within a broader pattern of scrutiny on Chinese investment in U.S. technology. Reports summarizing the move state that Trump orders Chinese-owned firm to unwind chip asset deal and that Trump orders Chinese-controlled firm to unwind chip asset deal, citing national security risks, language that underscores how the buyer’s ties to China are central to the narrative. Those descriptions, captured in coverage that notes Trump orders Chinese-owned firm to unwind the deal and in another account that says Trump orders Chinese-controlled firm to divest, reflect a political environment in which Chinese investment in semiconductors is treated with particular suspicion.
Inside the Treasury and CFIUS decision-making
The Treasury Department, which chairs CFIUS, has been explicit that the president’s order follows a formal recommendation from the interagency committee after it concluded that mitigation measures would not be enough. In a statement on the President’s Decision Ordering the Divestment of Interests in Certain Assets of EMCORE Corporation by HieFo Corporation, officials explained that Jan, WASHINGTON, Today, President Trump, Corporation are all part of the formal description of how the decision was communicated and that the committee’s review led directly to the call for divestment. That explanation, set out in the statement on the President’s decision, underscores that this was not an ad hoc political move but the culmination of a structured review process.
More detailed language in the same release reinforces that CFIUS is focused on the potential for foreign investors to gain access to sensitive data, technology, or infrastructure, and that it weighs those risks against any proposed safeguards. The broader press material, which refers to Jan, CFIUS, EMCORE in describing the case, situates the Emcore–HieFo decision within a pattern of interventions where the committee has either blocked or reshaped deals involving critical technology. That context, laid out in the account of how CFIUS acted in this case, shows that the committee is increasingly willing to recommend that the president order full divestment when it believes sensitive semiconductor assets could be moved away from the United States.
Semiconductors, security, and the Emcore footprint
Emcore’s role as an aerospace and defense specialist helps explain why its chip assets drew such intense scrutiny once a Chinese-linked buyer entered the picture. The company’s computer chips and wafer fabrication operations in Alhambra, California, support products used in navigation, digital video, and other high-reliability applications that can have both civilian and military uses. Reporting on the blocked deal notes that President Donald Trump on Friday moved to stop the sale of these operations, including the facility and its base of employees in Alhambra, California, highlighting how the Alhambra workforce is directly affected by the order.
Beyond the immediate jobs impact, the case illustrates how even relatively small chip fabrication lines can be treated as strategic assets when they support aerospace and defense customers. A separate account notes that US President Donald Trump signed an executive order targeting Chinese-owned HieFo’s planned acquisition of Emcore assets related to digital video and navigation chips, underlining that the focus is on technologies that can be integrated into guidance systems and secure communications. That framing, captured in coverage that explains how Trump halts Emcore–HieFo over national security concerns, shows why CFIUS and the president were unwilling to accept a structure in which a Chinese-controlled buyer would own and operate those lines on U.S. soil.
How this fits a broader pattern of Trump-era tech controls
The Emcore–HieFo decision is part of a broader pattern in which President Trump has used executive authority to block or unwind technology deals that raise security concerns, particularly when Chinese investors are involved. One summary of the latest move notes that Trump Orders Chinese, Controlled Firm To Divest EMCORE Semiconductor Assets Over Security, language that echoes earlier interventions in telecommunications and chip manufacturing. That description, highlighted in a piece titled Trump Orders Chinese Controlled Firm To Divest EMCORE Semiconductor Assets Over Security, underscores how the administration is willing to force divestment rather than rely solely on export controls or licensing regimes.
Other accounts of the same decision emphasize that President Trump signed an executive order on Friday blocking a chipmaker merger, citing national security risk, and that in 2024 the two corporations announced HieFo’s acquisition of EMCORE’s digital video and navigation chip assets. That narrative, captured in reporting that notes Trump blocks chipmaker merger, situates the Emcore case alongside a series of actions that have tightened the perimeter around U.S. semiconductor know-how. Together, they send a clear signal that deals involving Chinese buyers and critical technology will face the highest level of scrutiny and, increasingly, outright rejection.
Global chip rivalry and the message to investors
The decision to unwind the Emcore–HieFo deal also reverberates beyond the United States, particularly in Asia, where governments and companies are closely watching how Washington polices Chinese-linked investment in chips. One analysis notes that the U.S. blocks Chinese-linked firm’s acquisition of Emcore over national security risks and that the deal, valued at about 4 billion Korean won in April 2024, is now being reversed. That account, which specifies that the report was By Oh Ro and Published 2026.01.04, underscores how the U.S. blocks Chinese-linked firm’s acquisition in a way that will be closely parsed by investors weighing cross-border semiconductor deals.
For global capital, the message is that even relatively small transactions, such as a 4 billion Korean won purchase of specialized chip assets, can be upended if CFIUS and the president see a security risk. That reality is reinforced by coverage that frames the move as Trump blocks chips deal, cites security, China-related concerns, and notes that By Kanishka Singh, Updated Sat, PST, WASHINGTON, Reuter, the administration did not specify every detail of the national security risk but made clear that China-related issues were central. The description of how Trump blocks chips deal over such concerns will likely prompt both U.S. and foreign firms to build CFIUS risk into their dealmaking from the outset, especially in sectors like semiconductors where the line between commercial and strategic value is increasingly thin.
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