Joo Won-ho, second from right, head of HD Hyundai Heavy Industries' naval and special ship business unit, and SIMA General Manager Cesar Augusto Benavides Iraola, left, pose at Centro Naval de San Borja in Lima, Tuesday (local time), after signing a contract for joint production of ships for the Peruvian Navy. From left are Iraola, Peru's Finance Minister Jose Arista Arbildo, Prime Minister Gustavo Lino Adrianzen Olaya, President Dina Boluarte, Joo and Peruvian Defense Minister Walter Astudillo Chavez. Courtesy of HD Hyundai

HD Hyundai Heavy Industries (HHI) signed a 640.6 billion won ($463 million) contract on Tuesday (local time) with SIMA, a Peruvian state-owned shipyard, to build four warships for the South American country's navy, the Korean shipbuilder said Wednesday.

The deal is the largest among naval ship orders that any Latin American country has placed with a Korean company so far.

This came after the HD Hyundai affiliate was selected late last month as the preferred bidder for joint production of one 3,400-ton frigate, one 2,200-ton offshore patrol vessel (OPV) and two 1,400-ton amphibious warfare ships in Peru.

"We are witnessing a historic milestone. Today, SIMA signed an agreement with the South Korean company HD HHI to build four ships for the Peruvian navy," Peruvian President Dina Boluarte said after the signing ceremony. "The ships will allow the Peruvian navy to reinforce patrolling to combat crimes on the high seas, strengthen national defense and provide assistance to Peruvians in the face of emergencies that come forward."

In collaboration with SIMA, HD HHI plans to deliver the naval ships to the Peruvian navy by 2030. The Korean firm will design the ships, supply materials and offer technical support, while the Peruvian company will build the vessels.

The latest deal also allowed HD HHI to become a strategic partner of the Peruvian government and navy for the next 15 years. As a result, the company was chosen as the preferred bidder to additionally build five frigates, three OPVs and two amphibious warfare ships for the country's navy.

An illustration of HD Hyundai Heavy Industries' 3,400-ton frigate, center, a 1,400-ton amphibious warfare ship, top and a 2,200-ton offshore patrol vessel. Courtesy of HD Hyundai

"We will utilize our advanced technologies and extensive experience to enhance the Peruvian Navy's combat capabilities," said Joo Won-ho, head of HD HHI's naval and special ship business unit. "We will help SIMA secure enough capacity to build naval ships and make efforts for the shipyard to become our regional foothold in Latin America."

HD HHI also emphasized that the recent achievement was the result of its cooperation with the Ministry of National Defense, the Republic of Korea Navy, the Defense Acquisition Program Administration, the Korea Coast Guard, the Ministry of Trade, Industry and Energy, the Embassy of Korea in Peru and the Korea Trade-Investment Promotion Agency.