Seoul - Hanwha Group was chosen by South Korea's state-run Korea Development Bank (KDB) as the preferred bidder for a controlling stake in Daewoo Shipbuilding & Marine Engineering, the KDB announced on Friday.

"Hanwha was found to best fit our criteria of selection, including bid price, management ability and fund-raising plan," Chung In-Sung, deputy governor of the KDB, said at a press conference.

Hanwha, a conglomerate with roots in explosive maker Hanwha Corp, won out rival bidder Hyundai Heavy in the bid for a 50.5 per cent stake of the world's third-largest shipbuilder.

The deal is estimated to be worth at least 4 billion US dollars, although the KDB declined to quote the bid price.

Meanwhile, steelmaker POSCO, another rival, pulled out of the contest after its consortium partner GS Group abruptly walked out of the bidding contest. (dpa)