The long-awaited $4bn-plus sale of Hyundai Engineering & Construction is likely to be delayed until 2008, bankers say, with a state-linked creditor wanting to avoid a politically sensitive battle between feuding factions of the former Hyundai conglomerate.

Hyundai Group and Hyundai Heavy Industries are both likely bidders for their former affiliate, but they are locked in a power struggle, which would be inflamed if either took control of the construction unit.