Merger and acquisition activity declined by over 4% in volume terms last year.

American energy company Eaton’s decision to buy Cooper Industries and place the combined company’s headquarters in Cooper’s Irish home instead of Eaton’s Cleveland, will save $160m (€125m) a year in taxes by 2016, the firms have said.

BSkyB’s on-off takeover saga and renewed fears over the spread of Europe’s debt crisis led to a dramatic session in the City today.