Housebuilder Cala is being targeted by a Chinese company interested in launching a £600 million takeover.

According to City sources talks have taken place recently. It is the latest in a string of reports of either a trade sale or IPO of the Scottish company.

Cala is owned by private equity firm Patron Capital Partners and insurer Legal & General who bought the company three years ago for £210m.

It has been in rude health, benefiting from a robust level of activity at the top end of the market.

Earlier this month it reported an 18% rise in annual pre-tax profits to a record £60.1 million on a 15% increase in revenue to £587.1m.

It is focused at the top of the market in affluent areas of the Midlands, Scotland, and around the M25.

The firm’s average selling price in England is £639,000, against the Scottish  average of £476,000.

The company said fewer homes were selling for more than £1.25m. These make up 5% of sales, and the company said it would build fewer in this market.