By Jaime Llinares Taboada

Weir Group PLC said Monday that it has agreed to sell its oil-and-gas business to Caterpillar Inc. for $405 million.

The FTSE 250 engineering company said the deal follows its strategy of becoming a pure mining technology company. The proceeds will be used to reduce leverage.

"Alongside the previous sale of the flow control division and the acquisition of ESCO, it is a major milestone in transforming the group into a focused, premium mining technology business," Chief Executive Jon Stanton said.

Weir's oil-and-gas business contributed an adjusted operating profit of 36.4 million pounds ($47.1 million) in 2019, and an adjusted operating loss of GBP4.4 million in the first half of 2020.

Write to Jaime Llinares Taboada at jaime.llinares@wsj.com; @JaimeLlinaresT

(END) Dow Jones Newswires

10-05-20 0234ET