The deal is expected to be completed by the end of the month with the cash being used to help pay off debt.
Mouchel has had a difficult few weeks after a £8.6m black hole appeared in its accounts, .
Grant Rumbles, appointed as new Mouchel chief executive last Friday, said: “The sale of Mouchel Rail is a key step in our strategy to focus on Mouchel’s leading positions in core markets.
“We wish the rail business and its employees every success in the future.â€
Rumbles succeeded Richard Cuthbert as chief executive, with David Sugden appointed interim after predecessor Bo Lerenius resigned.
Got a story? Email news@theconstructionindex.co.uk