After receiving pressure from an activist investor to cut costs, chemicals manufacturer Ashland is selling its water technologies unit to buyout firm Clayton, Dubilier & Rice in a deal worth roughly $1.8 billion.

Covington, Ky.–based Ashland—which makes Valvoline motor oil along with a variety of other chemical products and ingredients— said in November that it planned to sell its water technologies business as well as an elastomers unit. Jana Partners, the company’s second-largest investor with a stake of roughly 8.5 percent, has been pushing Ashland to cut costs by shedding certain units in favor of its specialty chemicals businesses, which have higher profit margins. Last month, Ashland said it would cut up to 1,000 jobs across its businesses, while relocating another 1,000 positions, in order to save as much as $200 million in annual costs.

In the deal announced Tuesday, CD&R is acquiring a unit that produces $1.7 billion in annual sales and employs 3,000 people. The business makes water treatment chemicals used by the pulp and paper industry as well as to treat wastewater. The deal is expected to close by the end of September, pending regulatory approvals. Ashland says the deal will generate net proceeds of about $1.4 billion, most of which the company plans to put toward a share-buyback program that will expire Dec. 31, 2015.

Debevoise & Plimpton is advising longtime client CD&R on the acquisition. The firm recently advised CD&R on its $300 million purchase of engineering company Harsco in September as well as the buyout firm’s $1.05 billion acquisition of wedding attire retailer David’s Bridal in 2012. On CD&R’s purchase of the Ashland unit, New York–based corporate partners Paul Bird and Michael Diz are leading a Debevoise team that also includes finance chair David Brittenham, executive compensation and benefits partner Jonathan Lewis, tax partner David Schnabel, corporate counsel Brandon Gruner and environmental counsel Stuart Hammer.

Meanwhile, Ashland is being advised by Cravath, Swaine & Moore and Squire Sanders. As we have previously reported, Cravath is Ashland’s longtime counsel, having advised the company on a variety of matters, including the $3.2 billion purchase of International Specialty Products in 2011.

Cravath’s team on Tuesday’s deal includes M&A partners Susan Webster and Thomas Dunn as well as banking partner George Zobitz, executive compensation and benefits partner Eric Hilfers, IP partner David Kappos, antitrust partner Peter Barbur and tax partners Stephen Gordon and Lauren Angelilli. Banking senior attorney Christopher Kelly, environmental senior attorney Annmarie Terraciano and real estate practice area attorney Gary Eisenman are also advising, along with Cravath associates Matthew Cantor, Christopher Couvelier, Benjamin Landry, Edward McGehee, Derek Musa and Ankur Patel. Andrew Jennings and Martin Mohr—Cravath associates who have not yet been admitted to the bar—also worked on the deal.

The Squire Sanders team also counseling Ashland is led by Cleveland-based corporate partner Carolyn Buller, who is working with benefits partner Carl Draucker, labor and employment partner Janette Lucas, antitrust partner Oliver Geiss and associate Jonathan Whittlesey.

Ashland’s general counsel is Peter Ganz.