The Ministry of Sound is expected this week to sell a 20 per cent stake in its £100m nightclub empire to venture capitalists 3i.

The deal will see Ministry's owner James Palumbo receive a £20m windfall in preparation for an anticipated flotation on the stock exchange.

Palumbo has developed Ministry of Sound from a £250,00 nightclub in Elephant and Castle in 1991 to a global clubbing brand, with dance events across Europe, CDs, a radio station, clothing range and even a magazine.

Last year Palumbo joined forces with Pierre-Yves Gerbeau to stage the closing party at the Millennium Dome, and in March both parties again joined forces in a failed attempt to buy the Greenwich site.

This weekend Ministry of Sound rolls up in Knebworth House in Hertfordshire to stage an outdoor dance music festival for 50,000 revellers in the grounds of the stately home.