Tata Steel could finalise a rescue deal for Port Talbot next quarter

Jessica Morris
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The Port Talbot steelworks in South Wales employs 11,000 people (Source: Getty)

​Tata Steel could finalise a rescue deal for its UK assets, including the Port Talbot steelworks, as early as next quarter.

The Indian congolomerate first revealed its UK business was under review in February. It recently paused the sales process to explore a merger of its European operations with rival firm ThyssenKrupp.

Unions previously urged Tata to provide more clarity over where the negotiations are, what the next steps should be and how the government can support this.

Read more: UK steel industry under pressure as global trade war heats up

The Guardian reported last night that talks to safeguard Tata's UK business are "nearly there", however a rescue deal may not be finalised until the final quarter.

ThyssenKrupp said yesterday that the Brexit vote hasn't affected the likelihood of a merger between itself and Tata.

"Brexit is something that definitely affects us on the timeline ... for the discussion, it's actually neutral," Thyssenkrupp's finance chief, Guido Kerkhoff, said.

Read more: China warns EU steel tariffs will hurt the bloc's manufacturers

Kerkhoff added that he couldn't predict how long the talks would take. "Sometimes one has to live with uncertainty," he said.

The fate of the British Steel pension scheme, which has liabilities of £15bn and a deficit of £700m, will be crucial to clinching a rescue deal.

Tata and ThyssenKrupp will only include the UK business in the merger if pension scheme can be restructured and government support secured, the Guardian added.