Dunloe House, the property company controlled by Dublin solicitor, Mr Noel Smyth, has agreed to buy a 3.85 acre site at Sir John Rogerson's Quay, Dublin, from Mr Smyth. The purchase price will be based on an independent valuation but will not exceed £7.5 million. The consideration is likely to be paid in cash. The deal will have to be approved by the non-Smyth shareholders at an extraordinary general meeting.

Dunloe which has been spurned by Belfast property company, Ewart, in its initial takeover approach, has said it intends to develop the Dublin quay site into a residential, offices, hotel and leisure complex. Mr Philip Byrne, managing director, said it would be a £40 million development carried out as a joint venture with a construction firm. As discussions are continuing, he was not prepared to nominate the firm.

A number of companies had approached Dunloe about developing the site, he said. Dunloe had an option to buy it from Mr Smith and decided to bring forward the intended date to exercise the option.

The site is situated on the south side of the river Liffey and adjacent to the entrance to the outer basin of the Grand Canal Docks. The purchase presented Dunloe with "a tremendous opportunity to develop a unique landmark site in the Dublin docklands", said Mr Byrne. "Our first task will be to discuss the full range of options for the development site with Dublin Corporation and the recently established Dublin Docklands Development Authority". The group, he added, wishes to develop the site "in the context of the overall plans for Dublin's docklands. Proximity to the water presents Dunloe with a challenge and a wonderful opportunity to play a very prominent role in the rejuvenation of a part of Dublin which we believe has the potential to flourish".

The proposed purchase is scheduled to be put to the shareholders early next year. And planning permission is expected to be sought late spring. Dunloe also an option to acquire 40 acres of development land in north Dublin. The exercise of this option will not be considered until next year, Mr Byrne said.

Dunloe made a takeover approach to Ewart, in which Mr Smyth has a 26.5 per cent stake, last month. Ewart gave it the thumbs down last Friday. A statement said the "approach" with the "three alternative forms of consideration (shares, loan notes, cash)" placed values on the company which were "unacceptable". Ewart has now asked Dunloe "in writing" to "end the period of uncertainty surrounding Ewart by reverting with a formal offer which can be put to Ewart shareholders".

Ewart has not indicated what value was placed on its shares by the approach. However, it understood to have been a little over the 65p value of Ewart's net assets per share.