Foreign investors' interest in doing business in Britain appeared to cool down in the first quarter of 2017, with the number of mergers and acquisitions deal (M&A) falling to its lowest level in three years.

According to figures released on Tuesday by the Office for National Statistics (ONS), 127 M&A deals were completed in the first three months of the year. Just under a third of them, 40, was completed by foreign firms snapping up their UK counterparts for a combined £5.1bn, the lowest level since the final three months of 2014.

The figure is in stark contrast with that recorded at the end of 2016, when the combined amount of overseas M&A deals in the UK stood at £85bn, the highest level in 10 years. Furthermore, the figure suggests that even the pound's sharp decline in the wake of the Brexit referendum in June last year was not enough to attract foreign investors to Britain.

Sterling lost over 15% of its value in the months following the referendum and while it has recently recouped some of the losses, it remains 12% lower than a year ago against the US dollar.

Meanwhile, British investment abroad also recorded a decline, with 26 outward M&A deals completed in the period for a combined total of £1.9bn, the smallest figure since the middle of 2013.

On the domestic front, the number of deals declined from 90 in the final three months of 2016 to 48 in the first quarter of 2017, but the combined value rose from £2.5bn to £3.6bn.