President Donald Trump has ordered the reversal of a $2.9 million transaction involving semiconductor technology, citing national security risks linked to the ownership and control of critical chip assets formerly held by Emcore Corporation.
The presidential order, signed on January 2, 2026, blocks and unwinds the April 2024 sale of Emcore’s chip and wafer design, fabrication, and processing businesses to HieFo Corporation, also known as High Efficiency Photonics. The decision follows a determination that HieFo is controlled by a citizen of the People’s Republic of China and that its control of the assets could threaten U.S. national security.
The Blocked Transaction
In April 2024, Emcore sold its digital chip and wafer operations to HieFo for approximately $2.92 million. The assets included chip and wafer fabrication capabilities and related intellectual property. HieFo emerged from a management buyout of these Emcore operations and focuses on high-efficiency photonic devices, particularly indium phosphide optical chips used in telecommunications, data-center connectivity, sensing, and AI networking.
Emcore has historically worked in areas including inertial navigation systems, photonic integrated chips, and optical technologies used in aerospace and defense applications.
Executive Order Findings
The executive order states that there is credible evidence leading the president to believe HieFo’s control of the Emcore assets could result in actions that may impair U.S. national security. The order specifies that the concern arises from HieFo being organized under Delaware law while controlled by a Chinese citizen.
The order formally prohibits HieFo from holding any ownership interest in Emcore’s chip and wafer design and fabrication business and mandates full divestment of those assets within 180 days.
Divestment And Restrictions
Until divestment is completed, HieFo is barred from granting access to the assets or to sensitive technical information. The company is also prohibited from restructuring or altering the assets without prior approval.
Oversight of the divestment process has been assigned to the Committee on Foreign Investment in the United States. The committee is authorized to enforce compliance through audits, inspections, and weekly reporting requirements.
Enforcement And Compliance Measures
Following divestment, HieFo must certify the transfer or destruction of all intellectual property associated with the Emcore assets. CFIUS will verify that these requirements have been fully met.
The order also prohibits any attempts to evade its requirements and authorizes enforcement actions by the U.S. Attorney General to ensure compliance with its terms.
Featured image credits: Wikimedia Commons
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