The number of merger and acquisition (M&A) deals in the European technology sector slipped two per cent in 2007 with a total of 3,215 transactions.

But the overall value of the trading was $349bn (£176bn), a rise of four per cent on the previous year, according to advisor firm Regent Associates.

The content and media sector represented the lion's share of the deals, with 957 transactions or 30 per cent of the market. The second largest sector was IT services, at 26 per cent, followed by software, which accounted for 13 per cent of activity.

"Acquisition activity in the technology sector held up remarkably well over the course of 2007," said Peter Rowell, chairman at Regent Associates.

"Overall, the technology industry is doing quite well, with good company performances producing solid profits and plenty of cash.

"Of course no-one is immune from any pending economic slowdown but, in the meantime, investments in acquisitions to implement strategic plans will continue."