Korea banks rebuff Hyundai Heavy's energy firm bid

SEOUL, May 14 (Reuters) - South Korean banks have scrapped an auction to sell a majority stake in a trading and resource-developing company due to a price gap with final bidder Hyundai Heavy Industries (009540.KS), a bank said on Thursday.

Eleven major shareholders, led by Korea Exchange Bank (KEB) (004940.KS) and Woori Bank, had put a 50 percent stake plus one share in Hyundai Corp (011760.KS) up for sale early this year. The stake on offer was valued at 205.5 billion won ($166 million) by Thursday's close.

Hyundai Heavy, the world's top shipbuilder, was the only suitor for the South Korean company by the May 13 deadline.

"Creditor banks and lead managers will try to sell the stake again either in an auction or a private deal sometime this year," after quelling concerns about the financial status of an overseas arm of Hyundai Corp, KEB said in a statement after market close.

"(We) will approve the sale only when it attracts an appropriate price, reflecting the improving performance at Hyundai Corp and dividend incomes from resource development."

KEB added that improving economic conditions would lead to a higher price tag if it was offered again at a later date.

South Korean banks and a state agency, own a combined 87.95 percent of Hyundai Corp after bailing out the former Hyundai Group unit in 2003.

Hyundai Heavy said in a filing to the Korea Exchange that it had been notified of the aborted auction. It declined to give further details.

The planned sale of Hyundai Corp came as South Korean banks were preparing to sell controlling stakes in chipmaker Hynix Semiconductor Inc (000660.KS) and Hyundai Engineering & Construction (000720.KS).

A deal to sell a majority of Daewoo Shipbuilding & Marine Engineering (042660.KS), the world's No.3 shipbuilder, broke down in January due to a dispute over financing terms with South Korea's Hanwha Group.

(Reporting by Kim Yeon-hee; Editing by Chris Lewis)