Engineering firm Goodwin has sold parts of its business, which supplies components for submarines and naval vessels, for £1.1bn.

The Stoke-on-Trent-based group struck a deal with Cerberus, a private equity firm set up by US defence official Stephen Feinberg, for parts of its mechanical engineering business, including defence operations.

The sale is expected to complete in the first quarter of next year, subject to regulatory approval, Goodwin said.

Following the agreement, the firm said it would undertake an “internal reorganisation” across the group prior to completing the sale.

“Today’s announcement represents a significant milestone in the history of Goodwin as we reposition our business and deliver significant value for our shareholders,” said chairman Timothy J W Goodwin.

In August, bosses first announced that they were exploring a possible sale of a “substantial part” of its mechanical engineering division, which includes Goodwin Steel Castings (GSC), Goodwin International (GI), Noreva, Easat and Pumps.

Goodwin added: “The board would like to express its gratitude to all employees across GSC, GI, Noreva, Easat and Pumps for their dedication, professionalism and contribution over many years.

Michael Sanford, global head of private equity and co-head of supply chain and strategic opportunities at Cerberus, said the firm was committed to investing in the UK.

Last month, Goodwin revealed that profits more than doubled over the past year as a global increase in military spending support demand for radar equipment and submarine parts.