Trump Mandates Divestment in Chip Deal to Safeguard U.S. Security
In a significant move to protect U.S. security interests, former President Donald Trump has mandated the divestment of a computer chips deal involving HieFo Corp. The executive order, issued recently, addresses concerns over the ownership of technology posed by the company.
Details of the Computer Chips Deal
The controversial deal, originally valued at $2.9 million, took place under President Joe Biden’s administration in May 2024. This deal involved Emcore Corp., a specialist in aerospace and defense, selling its computer chips and wafer fabrication operations to HieFo Corp. The purchase included assuming approximately $1 million in liabilities.
Concerns Over National Security
Trump’s decision comes after he discovered credible evidence indicating that HieFo’s ownership could pose a risk to U.S. security. He has given the company a strict deadline of 180 days to divest its technology. The alarm primarily arose because HieFo Corp. is linked to Chinese citizens, including Dr. Genzao Zhang and Harry Moore, who founded the company.
Background on HieFo Corp.
- Founded by: Dr. Genzao Zhang and Harry Moore
- Location: Alhambra, California
- Previous Role of Zhang: Vice President of Engineering at Emcore
After the acquisition, Zhang, now CEO of HieFo, expressed his commitment to advancing innovative technological solutions, including applications in artificial intelligence. Despite these assurances, the potential threat posed by foreign ownership has led to the current mandate.
Emcore and Corporate Changes
Emcore Corp. was publicly traded when the sale to HieFo occurred but was taken private in the previous year by Charlesbank Capital Partners, an investment firm. As the situation develops, HieFo has not yet commented on the divestment directive that Trump’s administration has enforced.
This decisive action highlights ongoing concerns regarding foreign investment in U.S. technology sectors, particularly those that have implications for national security.
