ACT Venture Capital has purchased a large minority interest in the Fitzpatrick Hotel Group for £6 million as part of the hotel's £10 million development and expansion plan for its three Irish hotels. The size of ACT's stake has not been disclosed but is understood to be 30-40 per cent. Mr Niall Carroll and Mr Walter Hobbs of ACT have joined the Fitzpatrick group board as non-executive directors.

ACT, the venture capital group set up by three former executives of Allied Irish Banks in 1994, has no exit mechanism. However, the eventual plan is to float off the hotel group in five to seven years time

The group owns three hotels in Ireland, one in the US and operates the British Airways Hotel in Manhattan. Its plans include the acquisition of further hotels in Ireland and in the US but these are not in the immediate pipeline.

The £10 million will be used to expand its hotels in Dublin, Cork and Bunratty to cater for the expected expansion of the tourism and conference markets of the late 1990s. This programme will take about 18 months to complete. The group employs 600 people and an additional 100 jobs are expected to be created.

Part of the refinancing of the group involves a rescheduling of the loan stock, around £6 million, which had been arranged with institutional and private investors in 1989. The package also includes banking facilities of more than £20 million, the group said.

Mr Paddy Fitzpatrick, the group's chairman, said "expansion in the US is an important part of our plans. He also feels there is room for further Fitzpatrick hotels in Ireland.

ACT manages institutional investments in a number of companies. Since it was set up, it has invested £12 million. ACT now has stakes in seven companies which include minority interests in Clashfern (it controls the Campus Oil and Microbio companies), Imari (a transport company), Belfast Airport, Heiton Holdings and Fisco (O'Casey's cream liqueur).