Austal, the only ASX-listed defence shipbuilder, says it will have no trouble raising debt to help fund a $US300 million ($441.3 million) expansion in the United States.

Austal chief executive Paddy Gregg said debt was a more attractive option than an equity raising because the market was undervaluing the stock, which may have contributed to interest from South Korea’s Hanwha Group and other takeover suitors.