Talks back on as Dubai offers £260m for Minerva

The Dubai sheikhs bidding for City office developer Minerva today upped their takeover offer to nearly £260 million.

Minerva, which is behind the proposed Minerva Tower to the rear of Aldgate station and the Walbrook office block near Cannon Street, rejected the Gulf State of Dubai's first offer as being too low at about 150p a share.

Now the bidder, using the company name Limitless, has upped its potential offer price to 160p a share and the talks are back on.

Shares in Minerva surged nearly 80% - up 56p at 128p - as investors showed their relief at being thrown a lifeline from the crisis stalking the British property market.

If the deal comes off at 160p, that would be a higher price than Minerva has seen since the start of the year.

With their deep pockets, plumped up by massive oil revenues, the sovereign wealth funds of the Middle East are beginning to sniff around London office properties in the hope of snapping up undervalued assets.

Minerva said in a statement today that Limitless had described its latest bid as a "final offer" although it could still increase the price if a rival offer came over the horizon.

Kuwait wealth fund St Martins recently bought the Willis insurance broker HQ from British Land for £400 million while Qatar took an 80% stake in the Shard of Glass development.