South Korea’s Daelim Industrial Co. will relist after demerging into holding and operating entities that would separately oversee construction and petrochemical units.

The company’s board on Thursday okayed a plan to create the holding entity DL Holdings, construction unit DL E&C and petrochemical unit DL Chemical. The company names are not final and could change at a later date. The company also filed with the securities authority to relist after the demerger.

Daelim Industrial shares fell 6.03 percent to close Friday at 87,200 won ($73.5).

Under the proposal, Daelim Industrial will demerge to DL Holdings and DL E&C, with the companies to hold 44 percent and 56 percent of the shares, respectively. DL Holdings will spin off its petrochemical business to create DL Chemical and hold a full stake in the new petrochemical company.

Daelim is seeking shareholders’ approval on Dec. 4 with an aim to launch the new holding entity on January 1, 2021. It plans to make DL E&C its subsidiary by having it undertake a share swap agreement with the holding company.

“Having two very different businesses like construction and petrochemical under one roof made it difficult to create business synergies,” a company official said. “(With the demerger), the two companies will now pursue different growth strategies to maximize shareholder interests.”

Experts expect Daelim’s new holding company structure to help improve its corporate transparency. The company also plans to expand its internal trade committee into a governance committee that would be filled entirely with outside directors.

DL Holdings is expected to focus on supporting the growth of Daelim units and coordinating their operations. DL E&L will accelerate its digital transformation to achieve greater productivity with an aim to become a total solution provider. DL Chemical will expand its low-cost material businesses while venturing into new areas like lubricants and medical new materials to become one of the world’s top 20 petrochemical companies.

Daelim recently merged its construction units Samho and Korea Development to create Daelim Construction Co., which is Korea’s No. 17 construction company by execution capacity.

In March, Daelim Industrial completed the $530 million acquisition of Cariflex, the chemical business unit of U.S. Kraton Corp., in what was the Korean company’s first overseas buyout.

By Sohn Dong-woo and Kim Hyo-jin

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