Powerwave, the US technology company, has made a $407m (€340m) takeover bid for Sweden's Allgon, in a deal which is taken as a further sign of growing confidence in the battered technology, media and telecommunications (TMT) sector.

Directors of Allgon, which writes wireless communication networks software are recommending the offer from Powerwave, which makes amplifiers used in mobile phones. Deutsche Bank advised Powerwave while Merrill Lynch and Enskilda Securities acted as co-financial advisers to LGP Allgon.