Japan group closer to buying Brazil Namisa-report

SAO PAULO, Sept 30 (Reuters) - A Japanese consortium is the strongest candidate to take Brazilian steelmaker CSN's Namisa iron ore unit after a Chinese group of companies abandoned talks last week, a Brazilian newspaper said on Tuesday.

The Chinese consortium, led by Shagang Group, has pulled out of the running due to "lack of consensus" about the value of its bid, O Estado de S. Paulo reported, citing an unnamed source close to the talks.

Tata Steel (TISC.BO) and ArcelorMittal ISPA.SA have also abandoned talks, the source told Estado.

The Japanese consortium, which includes Nippon Steel Corp (5401.T), JFE Steel Corp (5411.T) and Itochu Corp (8001.T), is now seen "as the only strong candidate still interested in the deal," the newspaper said.

CSN (CSNA3.SA)(SID.N) declined to comment. In a statement on Monday, the steelmaker said it was still in talks to sell at least a part of Namisa.

Shagang Group, China's largest private-sector steel mill, recently said it did not not expect talks on a possible purchase of a stake in Namisa to finish before the end of September.

It had said negotiations were complicated and the value of its bid was not clear.

CSN has said it wants to sell 40 to 50 percent of the unit but would entertain bids for the whole company, which has complicated the bidding process.

(Reporting by Inae Riveras, editing by Dave Zimmerman)