Tata Steel chairman Natarajan Chandrasekaran said the company was in “intense discussion” with the Boris Johnson government to find a sustainable and structural solution to the UK steel business of the company.

Facing a barrage of probing questions from the shareholders at the company’s 113th annual general meeting where they expressed doubts over the future of the European business, the chairman said the “hope and aim is to find a solution by the end of the fiscal year”.

Chandra said the company had a target to bring down debt to Rs 75,000 crore and have a debt-to-EBIDTA ratio of “3 or less” for a size and magnitude of the company’s operation “as soon as possible”, as shareholders questioned the elevated debt level of Tata Steel, which is over Rs 1 lakh crore now.

“It can be a matter of months before we can have a decision but if we have a successful outcome, then it is good. We are also thinking of alternative options. But our interest and focus is to see that we find a solution that is lasting,” Chandrasekaran informed the shareholders.

The statement comes amidst intense speculation over the future of the UK business as British media reported that the UK government has declined the request of Tata Steel to provide financial assistance. At least one potential suitor, Liberty House of Sanjeev Gupta, has said it was open to acquiring the Tatas’ UK steel business — including the main production site Port Talbot — if they sell it.

The Tatas’ operations in Europe are spread between the UK and the Netherlands, the latter being a more modern and efficient plant with positive contributions. Chandra explained that there was nothing wrong with the European business operationally.

“In Europe, the cost structure is such that we need a good spread, at least in excess of 260 euros (per tonne), which we have not been able to achieve. The last time we touched it was in 2018-19. But in 2019-20, it was around 230 euros per tonne. Now it is further lower to 200 euros per tonne. So, the steel price has to operate at a particular level to support that cost structure. This is where the losses are happening,” Chandra said.

The shareholders of Tata Steel India, the listed and holding company, are upset as the profitable domestic operation is continuing to fund the loss making European business and pulling down the stock price.