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Oil drilling equipment maker Cameron International Corporation (CAM - Analyst Report) announced that it has signed a deal with industrial goods manufacturer, Ingersoll-Rand Plc (IR - Analyst Report) for the sale of its Centrifugal Compression business. The transaction is valued at about $850 million in cash.

Cameron anticipates after-tax proceeds of about $600 million from the sale which it intends to use to buy back stocks. The transaction is expected to close by 2014.

Cameron added that the sale decision was made keeping in mind the company’s long-term strategy to focus on its core markets. The company also stated that it wanted to find a buyer more closely associated with the centrifugal compression business operations.

Revenues from the Centrifugal Compression unit, which provides centrifugal compressors services for various industries across the globe, were $396 million last year. Cameron mentioned that since the start of the third quarter, this division would be reported as discontinued operations.

Earlier in the year, Cameron sold its reciprocating compression business to the diversified conglomerate General Electric Co. (GE - Analyst Report), also as a strategic move to streamline operations.

Houston, TX-based Cameron is a leading manufacturer of pressure control equipment used in onshore, offshore, and subsea applications for oil and gas drilling, production, and transmission.

Cameron has consistently performed well in the past few quarters in terms of earnings results. In the trailing four quarters, the company has a positive earnings surprise of 4.89%, boosted by the second-quarter beat of 13.64%.

Currently, Cameron sports a Zacks Rank #1 (Strong Buy), implying that it is expected to significantly outperform the broader U.S. market in the next one to three months. Meanwhile, one can also consider other players from the same industry like Weatherford International plc (WFT - Analyst Report), which also sports a Zacks Rank #1.

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