Thai company SSI has signed the deal over Tata Steel's Teesside Cast Products (TCP), securing the future of the plant's 700-strong workforce.
The sale comes a year after the Redcar plant was partially mothballed after a major contract fell through.
The transaction - which should also create hundreds of new jobs at the site - is due to be completed by the end of March, the two companies said.
Head of Tata Steel Europe, Karl-Ulrich Kohler, said: "I am very encouraged that after all our efforts we have been able to reach this agreement, which is good news for the highly skilled and dedicated Teesside workforce.
"I commend SSI, the government and the trade unions for their roles in bringing about this agreement, and in particular the people of Teesside for the spirit and fortitude they have shown throughout the last, difficult two years."