A man accused of murdering four soldiers in an IRA bomb attack in London’s Hyde Park in 1982 has been arrested on suspicion of murdering two other soldiers in a separate attack.

Members of the Garda Síochána and the Northern Ireland police service (PSNI) arrested John Downey, 66, on Monday night in Co Donegal, in the Republic of Ireland, in a joint operation. He is due to appear at the high court in Dublin on Tuesday and is expected to face extradition proceedings.

It is understood that Downey was arrested on suspicion of abetting an explosion and of murdering Lance Corporal Alfred Johnston, 32, and Private James Eames, 33, two soldiers from the Ulster Defence Regiment (UDR), in Co Fermanagh in Northern Ireland in 1972.

The arrest was a dramatic reversal of fortune for Downey. He walked free from the Old Bailey in February 2014 after his trial for the Hyde Park murders collapsed because of a secret letter from the British government that gave him a guarantee he would not face trial, a revelation that caused uproar.

Downey’s lawyers argued that he should not face trial because he was one of 187 IRA suspects who were sent letters giving “a clear and unequivocal assurance” that they were no longer wanted by any police force in the UK. The British government gave the assurance in return for the IRA’s promise to decommission its arms as part of the Good Friday peace deal.

Downey had pleaded not guilty to the murder of four soldiers from the Household Cavalry who died in the blast on 20 July 1982, along with seven of their horses. The bomb had been concealed in a car and was detonated as the soldiers rode past on ceremonial duties.

Supporters and relatives of the four soldiers – Trooper Simon Tipper, 19, Lance Corporal Jeffrey Young, 19, Squadron Quartermaster Corporal Roy Bright, 36, and Lieutenant Anthony Daly, 23 – condemned Downey’s release and vowed to continue to fight to see justice done.

The victims’ families are pursuing a civil action against Downey, seeking financial compensation and pushing for a finding that he was liable for what happened.

Monday’s arrest, however, related to the deaths of the UDR soldiers a decade before the Hyde Park attack. Johnston and Eames died when an IRA bomb exploded in a car they were checking in Enniskillen on 25 August 1972. Their families have been kept informed of developments.

The PSNI reopened an investigation into the attack several months after the collapse of Old Bailey trial, leading to the joint operation with police in Donegal.

“Members of An Garda Síochána attached to the National Bureau of Criminal Intelligence arrested a 66-year-old male this evening, 5 November, in Donegal on foot of a European arrest warrant and is expected to appear before the high court in Dublin tomorrow 6 November 2018,” the Garda Síochána said in a statement.

The arrest will add pressure on authorities to pursue other alleged IRA men who were given so-called on-the-run (OTR) letters by Tony Blair’s government. Critics labelled them a “get out of jail free card”, but officials said they were part of an administrative scheme that merely informed recipients of statements of fact.

Arlene Foster, the leader of the Democratic Unionist party, welcomed Monday’s arrest.