UPDATE 1-Universal Compression Hldgs to sell compressor units

(Adds details on sale, background)

May 29 (Reuters) - Universal Compression Partners LP UCLP.O agreed to buy 715 compressor units, or 13 percent of horsepower, from its joint business with natural gas compression services company Universal Compression Holdings Inc. UCO.N for about $233 million.

The deal is expected to add about 15 cents to 20 cents annually to Universal Compression Partners' cash distributions per unit, the companies said in a joint statement.

In February, Hanover Compressor Co. HC.N said it would buy Universal Compression Holdings Inc. UCO.N for about $1.8 billion. The deal is expected to close in the third quarter of 2007, Universal Compression Holdings said.

The Houston-based company said it plans to transfer the rest of its domestic contract compression business over time to Universal Compression Partners, seen as its primary growth vehicle.

Universal Compression Holdings will get additional limited partnership units, an increase in the value of the general partner interest in Universal Compression Partners and cash proceeds, which will be used to repay debts, the company said.

Universal Compression Partners will finance the acquisition of the compressor units, expected to close in July, through a combination of about 40 percent debt and 60 percent equity, it added. (Reporting by Aditi Samajpati in Bangalore)