The spiralling battle for control of Lloyd's underwriter Limit took another twist this week when both warring bidders announced they were raising their offers.

Limit chairman Jonathan Agnew announ-ced that Wellington Underwriting and QBE Insurance had sent in proposals to take over Limit “at values in excess of those previously indicated by either party”. But the company refused to say what the higher offers were.

The game of leapfrog began in April when Limit and Wellington announced an agreed merger.

The next month, QBE jumped in with an unsolicited offer for Limit of 120p cash per share.

This was followed by an auction ending with QBE offering 135p per share in cash and Wellington proposing 100p plus 33.5p of convertible Wellington stock. Those offers put a value on Limit of around £360m.

In its latest announcement, Limit said it is “considering the enhanced proposals and will make a further announcement as soon as possible”.

It adds that “in the meantime shareholders are advised to take no action”.

Limit has made it clear all along it preferred a bid from Wellington. At the company's annual shareholder meeting last week Mr Agnew reaffirmed his support, saying the potential value of the loan stock during the upswing in the insurance cycle “outweighed the minor difference in the cash offers”.

A merger of Wellington and Limit would create the largest independent underwriting company at Lloyd's, with a capacity of £1.2bn.

QBE, an Australian insurer, bought Iron Trades for £175m at the end of last year.

Mr Agnew also told shareholders at the annual meeting: “Market conditions are continuing to improve in some sectors. Strong rating increases are now being seen in the US and international property sectors as well as in reinsurance and commercial motor.”