Analysts dismiss Barratt bid talk

But analysts dismissed the rumours as unlikely.

"It's not going to happen," said Alastair Stewart at Investec. "The panel rules are if Barratt has been approached and there's speculation, no matter how brief, Barratt would have to tell the panel."

Another analyst said a large acquisition in the sector would be unlikely at present given the economic uncertainty.

"Given where we are in the cycle, two months before an election, Barratt is a very big company and there is a lot of uncertainty, personally I think it's a lot of nonsense," he said.

Chris Millington at Numis said a deal between York-based Persimmon and Barratt would not make sense from a land perspective. "Last week it was Bovis, it's come round to Barratt, it looks a little bit weak to me. If you pay a premium for a housebuilder you may as well buy land in the open market," he said.

Persimmon was rumoured to be interested in buying smaller rival Bovis Homes last week.

But Persimmon's chief executive Mike Farley said the company was firmly focused on reducing its debt and improving margins this year, after reporting a swing back to a full-year profit aided by a substantial writeback.

Shares in Barratt rose 6.5p to 121.9p.