RPT-UPDATE 1-Buyer of Japan's Takefuji to be decided next month

(Repeats with UPDATE tag in headline)

* Five bidders in the running for Takefuji - administrator

* Ability to secure funds a key factor - administrator

* Some Takefuij assets may be sold to others - administrator

* Takefuji failed in last year owing $5.3 bln

By Junko Fujita

TOKYO, Feb 1 (Reuters) - The new owner of Takefuji Corp, a Japanese consumer lender that failed last year with more $5 billion in debt, will be chosen next month from a field of five bidders, the official overseeing the sale said on Tuesday.

Investment funds Cerberus Capital Management [CBS.UL] and TPG [TPG.UL], Japanese lenders Tokyo Star Bank and J Trust Co (8508.OS) and Korea's A&P Financial advanced to the final round of bidding, sources told Reuters last month. [ID:nTOE70B06R]

Eiichi Obata, the court-apppointed administrator in charge of the sale, confirmed at a media briefing that there were five bidders left but did not name them. He said the bidding would close on March 10 and a buyer chosen by the end of the month.

Bidders are planning to offer between 60 and 80 billion yen 60 billion yen ($732 million to $976 million) to buy Takefuji, sources have said, eyeing the chance to build a presence in Japan's once lucrative consumer finance market.

Obata did not comment on the potential price, but said the ability to secure funding as well as a committment to restructuring the company while maintaining its presence as a consumer lender would be key factors in selecting a buyer.

"Whether Takefuji will be able to lend in the future is a very important issue. Bidders will have to show how that is feasible during the second round of bidding," Obata said.

Takefuij failed in September owing 433 billion yen ($5.3 billion) after its profitability was squeezed by a government cap on lending rates and a 2006 court ruling forcing it and other consumer lenders to repay overcharged interest. [ID:nTOE68Q083]

A successful bidder will probably take over Takefuji's outstanding balance of performing loans. But other assets, including its headquarters building in Tokyo, may be sold to other investors, Obata said.

Bidders are keen to determine how much of the repayment of overcharged interest they would have to shoulder before agreeing to a deal.

At the time of Takefuji's bankruptcy filing, Obata had estimated Takefuji could face up to 2 trillion yen in claims from borrowers for the return of overcharged interest payments.

Obata said on Tuesday the total value of interest repayment was still unclear. He said Takefuji could face claims from about 2 million customers, of which only 330,000 have submitted claims for the amount they believe they are owed.

The sale of Takefuji had attracted other global distressed asset investors such as Lone Star [LS.US] and Fortress Group (FIG.N), sources said, before the field was whittled down to five last month. (Editing by Edmund Klamann and Nathan Layne)