Trump blocks chips deal, cites security, China-related concerns

WASHINGTON - President Donald Trump on Jan 2 blocked US photonics firm HieFo Corp’s US$3 million (S$3.8 million) acquisition of assets in New Jersey-based aerospace and defence specialist Emcore, citing national security and China-related concerns.

In an order released by the White House, Mr Trump said HieFo was “controlled by a citizen of the People’s Republic of China” and that its 2024 acquisition of Emcore’s businesses led the president to believe that it may “take action that threatens to impair the national security of the United States”.

The order did not name the individual or detail Mr Trump’s concerns.

“The Transaction is hereby prohibited,” Mr Trump said, ordering HieFo to “divest all interests and rights in the Emcore Assets, wherever located,” within 180 days.

The Committee on Foreign Investment in the United States identified a national security risk in its investigation of the deal, the Treasury Department said after Mr Trump’s order. The statement did not specify the national security risk.

HieFo and Emcore could not immediately be reached for comment and had not posted any reaction on their websites as of late on Jan 2.

Emcore, publicly traded at the time of the deal and later taken private, has said HieFo bought its chips business and indium-phosphide wafer-fabrication operations for US$2.92 million (S$3.75 million).

HieFo said at the time that it was co-founded by Mr Genzao Zhang, a former Emcore vice-president of engineering, and Mr Harry Moore, whose LinkedIn profile describes him as a former senior sales director at Emcore. REUTERS