Mergers and acquisitions (M&A) in the UK technology sector fell by 21 per cent to 482 last year, the lowest level since 2002.

The number of global deals also dropped by four per cent, with the biggest fall in the final quarter against the backdrop of the credit crunch, according to financial adviser Icon.

But the picture is not all gloom. Deals between UK and international companies are on the rise ­ up 53 per cent despite the comparative weakness of the dollar.

On the same day that Icon’s figures were published, Oracle announced its intended purchase of BEA Systems for $8.5bn (£4.3bn) ­ see page 12, and Sun Microsystems revealed plans to buy open source software firm MySQL for $1bn (£510m).