Insignia Financial Group (parent company of brokerage Insignia/ESG) has issued a statement acknowledging that it has held merger discussions with CB Richard Ellis. However, the statement emphasized that there is "no assurance that the current discussions will result in a transaction."

Spokespeople from both firms declined to comment on the rumor. Were the merger to happen, the combined entity would be the biggest real estate brokerage in the world.

The firms have reportedly discussed such a merger before. Last summer, the New York Post reported that merger talks between CBRE and Insignia (NYSE: IFS) had broken down. Following the release of the article, Insignia denied that any talks had even taken place. In Insignia’s statement released today, however, the firm claims that it has "in the past engaged in discussions about similar combinations, none of which have come to fruition." The outcome of the current talks is unclear.

With CB Richard Ellis in talks to buy Insignia/ESG, investor Carl Icahn is also now exploring a possible merger with Insignia. As of December 2002, Icahn had bought a total of 1.6 million Insignia shares — a 7% stake in the firm. His recent SEC filing states that Icahn’s High River LP is exploring the possibility of a merger without a tender offer. A confidentiality agreement with the brokerage gives Icahn access to Insignia’s books, but forbids him from disclosing any pricing information to the public. When merger talks began circulating last Friday, Insignia shares rose 16%. Insignias/ESG, the nation’s fourth largest office brokerage, has a $255 million market cap.