By Sam Jones - Dispute over sunken ship involves US firm, Spain and Peru, and raises British fears

The crew of Nuestra Señora de las Mercedes must have thought their ship had fought its final battle on the morning of October 5 1804. A little after 10 o’clock, their seven-month voyage from Peru, via Uruguay, to almost within sight of the Iberian peninsula came to an end with the British broadside that sent the treasure-laden frigate and 200 souls to the bottom of the Atlantic and brought Spain into the Napoleonic wars.

But after lying undisturbed on the seabed off Portugal for more than two centuries, the Mercedes is now at the centre of the biggest treasure grab in history.

The battle for ownership of its £254m cargo of gold and silver coins, which has already pitted a US treasure-hunting company against the Spanish government, has been joined by a third party. An emotive campaign is welling up from within Peru to reclaim the treasures the conquistadores and their descendants took by force over the course of almost three centuries.

Last May, the Florida-based Odyssey Marine Exploration announced that it had recovered 500,000 gold and silver coins weighing 17 tonnes from a wreck in international waters in the Atlantic and flown them back to the US from Gibraltar. Read the full Guardian Story