Smiths Group has agreed to sell its aerospace division to US giant General Electric (GE) for £2.5bn ($4.8bn).
Smiths makes a wide range of aerospace products
The UK aerospace-to-medical equipment maker said it was a cash deal, and that it would return £2.1bn to shareholders.
Smiths said it had decided to sell the aerospace unit to General Electric because of the increased investment requirements of the industry.
Smiths' shares closed up 11% at 1094.5 pence on the news. The firm's aerospace unit employs 11,000 staff in the UK.
Smiths and GE also announced a new joint venture to manage their detection and security businesses.
Smiths will own 64% of the new operation with GE controlling the remainder.
"By selling aerospace, we crystallise the value for our shareholders," said Smiths chief executive Keith Butler-Wheelhouse.
"At the same time, we know that this business is going to a great owner."
Smiths added that it intended to complete the deal in the second quarter of this year.
General Electric is the world's second biggest company by market value.