Hyundai Merchant Marine Co., the South Korean shipping company currently under creditor banks’ control, tumbled the most on record in Seoul trading on investor concerns that its plan to issue 200 billion won ($179 million) of convertible bonds would dilute shareholdings. Shares of the nation’s second-biggest shipping line fell 28 percent, the largest drop since data compiled by Bloomberg dating back to October 1995, to close at 7,640 won. The loss shrank Hyundai Merchant’s market value to 250 billion won and the stock was the second-worst performer on the Kospi index. Hyundai Merchant said Tuesday it will sell the convertible bonds with a 0.5 percent yield to five creditors, including Korea Development Bank and Woori Bank, as part of an earlier announced restructuring plan to swap existing debt into shares. The company is among liners worldwide that are undertaking debt reforms and asset sales to boost their balance sheets as overcapacity in the industry causes freight rates to stay depressed. “Investors are worried that the convertible bond sale will further dilute their holdings,” said Park Moo Hyun, an analyst at Hana Financial Investment Co. in Seoul. “Considering the low yield, there’s a very high chance the bonds will be converted to shares. The sale is a reminder that Hyundai Merchant isn’t out of danger yet even after creditors took over the company.” The creditors, which also include NongHyup Bank, KB Bank and Korea Securities Finance Corp., will buy the bonds, Hyundai Merchant said in a regulatory filing late Tuesday. The bonds, maturing on June 30, 2019, don’t pay an annual coupon and can be converted to shares at 9,530 won each starting Aug. 2, 2017. The convertible bond issue comes after the shipping company completed the sale of 280 million new shares to investors last month as part of the debt-for-equity swap plan.