Limit shares rise as rival bidders increase offers

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Limit, the Lloyd's of London insurer, said yesterday it had received enhanced offers from the British insurer Wellington Underwriting and its Australian rival QBE Insurance Group in the latest round of a protracted bidding contest.

Limit, the Lloyd's of London insurer, said yesterday it had received enhanced offers from the British insurer Wellington Underwriting and its Australian rival QBE Insurance Group in the latest round of a protracted bidding contest.

The company advised shareholders to sit tight as its shares, which have underperformed the insurance sector by 9 per cent in the year to date, added 3p to 138.5p.

QBE had earlier stepped up pressure on its UK rival by revealing it was in confidential talks with Limit's advisers HSBC, which are thought to be linked to a higher offer. Its chief executive Frank O'Halloran said he was looking for a recommendation from the Limit board. Last August Limit shunned QBE's proposed 170p-a-share offer. In May shareholders were critical of plans for an all-paper merger with Wellington, which were subsequently scuppered when QBE said it would offer 120p a share.

Earlier this month, Limit's board backed a Wellington proposal which offered 100p in cash and 33.5p in convertible stock, with a cash alternative, valuing the group at £360m. The Australian insurer, which is a third the size of Limit, then raised its offer to 135p, valuing it at £364m.

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