South Korean shipbuilder Hanwha Ocean Co. was selected Friday as the preferred bidder to build two next-generation frigates for the country's Navy, sources said.

Hanwha Ocean, formerly Daewoo Shipbuilding & Marine Engineering Co., edged out domestic rival HD Hyundai Heavy Industries Co. in the bidding for the Navy's fifth and sixth Ulsan-class frigates with enhanced anti-submarine and anti-air capabilities, according to the industry and military sources.

It marks the first time for Hanwha Ocean to beat HD Hyundai Heavy Industries in bids for military ships since its recent acquisition by defense-to-energy conglomerate Hanwha Group.

The warships will be built as part of Seoul's frigate acquisition program, code-named FFX Batch-III, under which the country plans to build a total of six 3,600-ton frigates to replace aging frigates and corvettes.

In March 2020, HD Hyundai Heavy Industries signed a deal with the Defense Acquisition Program Administration to construct the first frigate under the program.

SK oceanplant Co., the defense arm of South Korea's No. 3 conglomerate, SK Group, won an order from DAPA to construct the second frigate in October 2021, and the third and fourth vessels in December 2022.

In May, Hanwha Ocean set sail as the shipbuilding arm of Hanwha, which has recently won regulatory approval for its purchase of a 49.3 percent stake in DSME and managerial control. (Yonhap)