* MoU could be reached this month - spokeswoman
* Tata Steel receives approval for UK pension deal
* IG Metall still opposed to joint venture with Tata Steel (Adds trade union comment, report on Cevian)
FRANKFURT/DUESSELDORF, Sept 11 (Reuters) - Thyssenkrupp may reach an agreement in principle this month to merge its European steel business with that of Tata Steel , the group said on Monday, adding talks were constructive and had entered the final stretch.
A spokeswoman for Thyssenkrupp said the companies were close to a memorandum of understanding (MoU), paving the way for a detailed look at one another's books and detailed negotiations before creating the second-largest steelmaker in Europe.
Thyssenkrupp CEO Heinrich Hiesinger is under pressure to deliver the planned combination, particularly following Tata Steel's deal to cut its pension liabilities, after talks have dragged on for a year and a half.
Hiesinger favors a steel joint venture, saying this is the best option to eliminate overcapacities in the volatile steel sector but drawing opposition from labor representatives, who fear thousands of job cuts.
"The management board is currently in talks over strategic options," the spokeswoman said, adding a meeting of the supervisory board initially scheduled for Sept. 12 had been moved back to ensure it was adequately informed.
A spokesman for Thyssenkrupp's works council said the meeting was scheduled to take place on Sept. 23 or 24.
Shares in Thyssenkrupp ended the day up 1.4 percent and have gained about 17 percent this year, partly in anticipation of a deal.
Trade unions remain opposed to Hiesinger's plan, preferring a carve-out that would see Thyssenkrupp list its healthy assets including its elevator unit on the stock market instead, in a fashion similar to utility RWE.
"We reject a merger with Tata," said Dieter Lieske, head of the Duisburg-Dinslaken unit of IG Metall, Germany's largest trade union, adding there were no signs that labor representatives on the group's supervisory board would agree to the merger plan.
Lieske said Ulrich Lehner, Thyssenkrupp's supervisory board chairman, may be forced to use his casting vote if the 20-member board, with equal representation of labor and capital interests, reaches a stalemate over the decision.
Bloomberg on Monday reported that activist investor Cevian, Thyssenkrupp's No.2 shareholder, was also opposed to the merger with Tata Steel, potentially robbing Hiesinger of a majority if all labor representatives also vote against the plan.
A spokesman representing Cevian declined to comment.
Monthly Manager Magazin earlier reported that Thyssenkrupp's supervisory board could agree to a combination either on Sept. 23 or 24, citing people involved in the negotiations. (Reporting by Georgina Prodhan, Tom Kaeckenhoff and Christoph Steitz; Editing by Maria Sheahan and Mark Potter)