Image: Chris Shaw Image: Chris Shaw

Tata Steel has confirmed it will delay the sale of most of its UK business, following the vote to leave the European Union.

Last week, the Indian parent company said the result of the EU referendum could put the sale at risk, because political turmoil would prevent changes to the crucial pensions that any sale hinges on.

The sale of its businesses in Hartlepool, Rotherham and Stocksbridge will still go ahead, but following a board meeting in India, the company said it put the sale on hold "in the light of the uncertainties caused by the UK referendum and the outcome of the UK government's consultation on the British Steel Pension scheme."

It added: "Taking the above issues into account, the Board of Tata Steel has decided to also look at alternative and more sustainable portfolio solutions for the European business."

The government has offered to take a 25% stake in the business, and with steel prices rising comfortably since the sale was first announced, Tata is less urgent about offloading the business.

Tata Steel currently has a pensions deficit of £700 million across 130,000 members through the British Steel Pension fund, which it inherited when it bought the business in 2007.

On Thursday, Downing Street confirmed that Prime Minister David Cameron had spoken with Wales' First Minister Carywn Jones over the phone about the industry in Wales. The two confirmed that government support from both the Welsh and UK government was still on the table.

"They agreed on the importance of both governments continuing to work very closely in partnership to support the steel industry in Wales and across the whole of the UK," a spokesperson said.