Tata Steel Europe, the London-headquartered arm of the Indian multinational steelmaking company Tata Steel, plans to chop 1,250 jobs from its European workforce, according to a leaked memo seen by the Reuters news agency.

The internal communication from Chief Executive Officer Henrik Adam says the jobs must go in a rationalization triggered by "challenging circumstances" and the need to "urgently improve profitability".

"Our financial situation is serious and there's an urgent priority to improve the performance of the business and our cash position," Reuters quoted him as saying.

Tata Steel Europe, which was formerly known as Corus Group, has most of its European operations in the United Kingdom and the Netherlands. The company's main UK plant is in Port Talbot, South Wales, which is the UK's largest steelworks.

"The proposed plans aim to secure the future of our company and do what's best for our employees, given the very challenging circumstances we're currently facing," Adam wrote.

Corus Group was formed when Koninklijke Hoogovens and British Steel merged in 1999. At the time, the company was a member of the FTSE 100 Index.

Tata Steel bought Corus Group in 2007 and subsequently sold plants in England's Teesside region and in Scunthorpe to Greybull Capital in 2016 that were rebranded as British Steel. That company was sold to China's Jingye Group this week in a deal that will reportedly result in massive investment and save more than 3,000 jobs.

The internal Tata Europe memo also says the company will also no longer replace employees who leave the company.

However, the job losses are not as bad as first feared. In November, the company said it expected to lay off 3,000 European workers. The BBC said the revised number means fewer than 500 jobs may be lost in the UK, instead of the 1,000 feared.

"Although it's good news that we are able to minimize the impact on our current employees, we need to progress with speed to secure the future for the business," Adam said.

The memo said Tata lost 76 million pounds ($97 million) in earnings before interest, tax, depreciation, and amortization in the first nine months of the 2019/20 financial year.

Britain's Unite union called for urgent talks to discuss the situation.

Tony Brady, Unite's Tata representative, said the company's management should improve prospects by "reversing years of underinvestment".

"We just want commitments on investment in the UK," he told the Financial Times. "We want to keep steelmaking in the UK."

The Financial Times said workers at the Port Talbot plant "have endured years of uncertainty" that have been added to by the current high cost of raw materials, a manufacturing slowdown, and fallout from the novel coronavirus outbreak. The paper also said relatively cheap steel imported from China has made it hard for the company to compete.

Tata Europe's UK sites include Caerphilly, Llanwern in Newport, Port Talbot, Trostre in Llanelli, and Shotton in Deeside.