South Korean conglomerate Hanwha has made a nonbinding offer valued at more than $1 billion to buy Austal USA, a builder of ships and submarine parts for the U.S. Navy.

Australian shipbuilder and defense contractor Austal said the potential deal for its U.S. subsidiary is valued at between $1.05 billion and $1.2 billion.

The acquisition would provide Hanwha with Austal's Mobile, Ala., shipyard and access to major contracts that include some of America's most sensitive naval programs.

The yard in Mobile specializes in building ships for the U.S. Coast Guard and Navy. It also supplies submarine modules to General Dynamics Electric Boat for the construction of Virginia-- and Columbia--class submarines.

Austal USA employs about 3,500 workers and includes other assets such as repair facilities in San Diego, Calif.

Hanwha is seeking to expand its commercial and military shipbuilding ambitions in the U.S. at the same time that President Trump is trying to revitalize domestic shipbuilding.

Hanwha Ocean bought Philly Shipyard less than two years ago and has vowed to invest billions of dollars to expand and modernize the facility. Over the past year, Hanwha has won government contracts to build missile-tracking vessels and to design oilers that can provide fuel and equipment during naval operations.

Hanwha Defense USA, the subsidiary planning to take over Austal USA, is also planning a munitions and propellant factory in Arkansas to supply U.S. armed forces.