Europe's second-largest steel producer said an initial agreement for sale of its long-products manufacturing and distribution sites in UK, France and Germany.

Long steel products, such as rebards and rails are mostly used in construction. The division employees about 6,500 people in Britain and Europe.

Overall, Tata employs 30,500 people in Europe, including 17,500 in Britain.

Tata Steel had in August stated that it is taking steps to restructure operations and cut costs by producing more high-value products and cutting jobs. It today said it has decided to focus on strip products.

According to the memorandum of understanding signed with Geneva-headquartered Klesch, Tata will sell UK-based assets including Scunthorpe Steelworks, mills in Teesside, Dalzell and Clydenbridge in Scotland, as well as operations in France and Germany, if a final deal is struck.

"We have decided to concentrate our resources mainly on our strip products activities, where we have greater cross-European production and technological synergies," said Karl Koehler, chief executive of Tata Steel's European operations.

The two sides will "now move into detailed due diligence and negotiations, though no assurance can be given about the outcome," he said.

"We want to build a sustainable business in the UK and further develop our mainland Europe business and we are committed to providing the necessary leadership and financial resources to achieve that," he added.