April 11 (Reuters) - Brookfield Asset Management ( BAM )

is in advanced talks to acquire a majority stake in

private credit manager Castlelake with an investment of more

than $1.5 billion, the Financial Times reported on Thursday.

The deal would also see Brookfield make a large investment

in Castlelake's funds, the report said, adding that talks

between the companies are in the late stage and could still fall

apart.

Castlelake did not immediately respond to a Reuters request

for comment, while Brookfield declined to comment on the FT

report.

The deal comes at a time when the private capital groups

have been struggling to raise funds, and investors in private

equity funds are choosing to concentrate their investments with

fewer, larger managers.

Castlelake, an alternative investment firm, has about $22

billion in assets under management and invests in sectors such

as specialty finance and aviation, according to the company

website.