It said that its share sale is aimed at improving its financial status and raising money for investment in research and development, stressing that it does not have a liquidity crunch.

The company said that if the share offering is smoothly made, three shipbuilders -- Hyundai Heavy, Hyundai Samho Heavy Co. and Hyundai Mipo Dockyard Co. -- would be able to clear their loans and hold some 500 billion won in net cash.

Hyundai Heavy's debt-to-equity ratio is likely to fall to the 60-percent level from 87 percent with the share issuance, according to an estimate by industry watchers.

South Korean shipbuilders have been under severe financial strain since the 2008 global economic crisis, which sent new orders tumbling amid a glut of vessels and tougher competition from Chinese rivals.

Hyundai Heavy is bracing for local banks' possible move to tighten lending to local shipbuilders next year as the sector has yet to recover.

Samsung Heavy said on Dec. 6 that it will sell 1.5 trillion won in rights by March as it is likely to post an operating loss of more than 700 billion won in total in 2016 and 2017.

Meanwhile, Hyundai Robotics Co., the shipbuilding conglomerate's holding company, said it plans to conduct an IPO of Hyundai Oilbank Co., its refining unit. Hyundai Robotics is the largest shareholder of Hyundai Oilbank with a 91.1 percent stake.

Hyundai Robotics said that it is aiming to list shares of Hyundai Oilbank on the main KOSPI market in the second half of next year.

The proceeds will be used to improve the company's financial status and invest in new business, it said.

Established in 1964, Hyundai Oilbank posted a combined operating profit of 860 billion won in the first three quarters of this year.

"With Hyundai Oilbank's IPO, the group plans to pump up efforts to make the ownership structure transparent," said an official at the company. "In the first half of next year, it will seek to end the cross-shareholding ownership."

Hyundai Robotics has 27.8 percent interest in Hyundai Heavy Industries, which holds an 80.5 percent stake in Hyundai Samho Heavy Industries Co., a mid-sized shipyard.

Hyundai Samho Heavy has a 42.3 percent stake in Hyundai Mipo Dockyard Co., a mid-sized shipbuilder. Hyundai Mipo holds 4.8 percent interest in Hyundai Heavy Industries.

Industry watchers said that to eliminate the circular ownership, Hyundai Robotics may have to buy Hyundai Mipo's stake in Hyundai Heavy Industries or the shipbuilding affiliates under the wing may have to merge.

Even if Hyundai Robotics opts to buy the interest, it could shore up its financial status with the IPO, they said.

In June, Hyundai Heavy spun off its noncore businesses aimed at what it claimed would boost each business unit's competitiveness.

Under the plan, the shipyard split into four independent entities:

shipbuilding, electronics, construction equipment and robotics. (Yonhap)