Thyssenkrupp signals steel merger decision by end Sept - works council

DUISBURG, Germany (Reuters) - Germany's Thyssenkrupp wants to decide by the end of September whether to pursue a European steel merger with India's Tata Steel, the head of its steel works council said on Thursday.

Guenter Back told reporters that Chief Financial Officer Guido Kerkhoff had said the company would decide by the end of the 2016/17 fiscal year whether to proceed, after more than a year of talks that have been complicated by the UK Brexit vote.

"The ghost must be laid to rest," he said.

Thyssenkrupp declined to comment.

Thyssenkrupp and Tata are keen to combine their European operations in a 50/50 joint venture to remove overcapacity from the market and cut costs. Thyssenkrupp's operations are mainly in Germany, while Tata's are in Britain and the Netherlands.

A condition of any deal is that Tata finds a solution for its 15 billion-pound ($19 billion) UK pension scheme, which is heavily in deficit. It is unclear whether a recent deal to separate the pension from operations is sufficient.

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(Reporting by Tom Kaeckenhoff; Writing by Georgina Prodhan; Editing by Maria Sheahan)