In a decisive move underscoring national security considerations, President Donald Trump signed an executive order on Friday blocking the acquisition involving HieFo Corporation and Emcore Corporation. The deal in question concerned the sale of Emcore’s semiconductor business, including its indium phosphide wafer fabrication operations, for approximately $2.9 million. Emcore, headquartered in New Jersey, had entered into an agreement with HieFo, a Delaware-chartered company controlled by a Chinese national.
The executive order directly points to "credible evidence" that HieFo’s ownership could pose a threat to the United States' national security. The language in the order expresses concern that HieFo’s control, tied to a citizen of the People’s Republic of China, might result in actions that compromise sensitive technology or critical infrastructure.
As part of the order, HieFo is required to divest all rights and ownership interest in the Emcore semiconductor assets within a 180-day timeframe. The obligation to ensure compliance falls under the purview of the Committee on Foreign Investment in the United States, or CFIUS, which is tasked with assessing and monitoring foreign investments that may affect national security. This move follows a broader pattern of heightened scrutiny on foreign acquisitions within the semiconductor sector, especially those linked to China.
The Trump administration has increasingly prioritized actions aimed at curbing Chinese access to advanced technology in the semiconductor space. This executive order is one salvo among various measures, including a recently announced plan to impose tariffs on semiconductors imported from China, set to take effect in June 2027.
CFIUS itself has a history of intervening in foreign acquisitions deemed sensitive to national security. For example, in 2017, the committee recommended blocking acquisitions involving companies like Oregon-based Lattice Semiconductor, citing concerns similar in nature to those expressed now. These interventions illustrate a longstanding U.S. policy approach of protecting critical technology sectors from foreign control that might pose risks.
The Trump administration’s action fits within a wider context of efforts aiming to counterbalance China’s expanding influence in global technology markets. Earlier, in September 2025, the administration extended the deadline for TikTok to divest its operations from its Chinese parent company, ByteDance, following diplomatic discussions between President Trump and Chinese President Xi Jinping.
Additionally, U.S. lawmakers have advocated for legislation to restrict China’s access to cutting-edge artificial intelligence chips produced by major semiconductor companies including Nvidia Corporation and Advanced Micro Devices Inc. These restrictions are anticipated to remain in effect for at least the next two and a half years, emphasizing the strategic importance the U.S. government places on maintaining technological leadership and security safeguards.
President Trump’s executive order blocking the HieFo-Emcore transaction can be viewed as another activity in a chain of efforts focused on preserving American technological primacy and guarding against the growing reach of Chinese firms in sensitive sectors. This approach signals continued vigilance regarding foreign investments in critical American technologies.
Key Points:
- The Trump administration has blocked a $2.9 million acquisition by HieFo Corp. of Emcore Corp's semiconductor business due to national security concerns tied to Chinese ownership.
- HieFo, a Delaware company controlled by a Chinese citizen, is required to divest its interest in Emcore assets within 180 days under the supervision of CFIUS.
- This action is part of a broader U.S. strategy that includes imposing semiconductor tariffs on China and blocking prior deals like the Lattice Semiconductor acquisition.
- Congress has proposed measures to restrict China's access to advanced AI chips from companies like Nvidia and AMD for the coming years.
Risks and Uncertainties:
- Uncertainty over compliance and enforcement of the divestment order within the mandated 180-day period.
- Potential for ongoing tensions between U.S. and Chinese technology sectors driven by regulatory interventions and legislative measures.
- Risk of disruption to Emcore’s semiconductor operations and related supply chains due to ownership changes and regulatory scrutiny.