Ingersoll-Rand

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agreed to sell its Dresser-Rand business to a private equity buyer in a move to divest itself of noncore businesses.

Hamilton, Bermuda-based Ingersoll said it would get cash proceeds of $1.2 billion in the deal, which is expected to close in the fourth quarter. Ingersoll is selling the business to a fund managed by First Reserve.

Dresser-Rand develops, sells and services large, highly engineered centrifugal and reciprocating compressors, steam and gas turbines, and control systems. Its energy conversion technologies are used for oil and natural-gas production; refining; chemical and petrochemical processing; natural-gas processing, storage and transportation; and industrial power and energy recovery. The business employs 4,500 people and has manufacturing and service facilities worldwide.

"The sale of Dresser-Rand is an important strategic move for our company," said Ingersoll-Rand chief Herbert L. Henkel. "While Dresser-Rand today is a strong business with a bright future, its market, product and industry focus does not fit strategically with our core business. This divestiture will enhance the focus on our remaining business segments -- climate control, industrial solutions, infrastructure, and security and safety. These four segments comprise the core business platform we will further build upon through organic growth and bolt-on acquisitions. We remain confident that our strategies to develop innovative solutions for our customers and continuously improve our operations will generate dramatic growth and greater returns for our shareholders."

On Thursday, Ingersoll-Rand was flat at $64.50.