Jan. 7 (Bloomberg) -- Blackstone Group LP held talks last week with Close Brothers Group Plc, a 130-year-old British investment bank, that may lead to a takeover offer, people with knowledge of the negotiations said.

Discussions are at an early stage after a meeting on Jan. 4 and no price has so far been discussed, said the people, who declined to be identified because the negotiations are private. London-based Close Brothers has a market value of about 1.4 billion pounds ($2.8 billion).

Close Brothers said in December it had received approaches from possible bidders. The company rejected a 950 pence-a-share bid the previous month from Cenkos Securities Plc, a London- based stock adviser for small and mid-sized companies started by investment banker Andrew Stewart.

``Close's management have been very clear they do not want a hostile offer from Cenkos and they're doing their level best to fight it off,'' said Chris Smith, an analyst at Oriel Securities Ltd. in London with a ``hold'' recommendation on the shares. ``They want to keep the group together, and Blackstone would be one way of doing that.''

Close Brothers Chief Executive Officer Colin Keogh didn't return a call to his office for comment. Emma Burdett, an external spokeswoman for Close Brothers, and Sophia Harrison, a spokeswoman for New York-based buyout firm Blackstone, declined to comment. The Financial Times reported the talks Jan. 5.

Close Brothers shares fell 8 pence to 957 pence as of 10:35 a.m. in London. Oriel's Smith estimated Blackstone would have to offer at least 1,000 pence a share. The stock slipped 3.1 percent in the 12 months through Jan. 4.

To contact the reporter on this story: Edward Evans in London at at eevans3@bloomberg.net

Last Updated: January 7, 2008 05:50 EST