One other bidder wanted to buy almost 5,000 acres of land in the Dublin Mountains when Nama agreed to sell to the Government.
Growing concern that the land would be sold to a private party led Minister of State Michael Ring to go public with the deal yesterday - even though the sale still hasn't been formally signed off on.
The agency had been insisting it could not sell for less than the estimated market value of €2.5m. However, over recent weeks the minister argued that this price did not take into account the fact that over 90pc of the land is off-limits for development.
Sources told the Herald that Nama eventually retreated somewhat from its asking price of €500 an acre - but the price was still "considerable".
Mr Ring said that final price would be revealed once the deal is finalised.
The parcel of land, which takes in Kippure down to Glenasmole Valley and Bohernabreena Reservoir, was the largest to have come on the market in recent years.
Negotiations will now start with residents and farmers living in the area to decide what grazing rights, turf-cutting rights and shooting rights they will retain.
The minister said the purchase would help create "one of the largest national parks in Europe".
It will be added to the Wicklow National Park and managed by the National Parks and Wildlife Service, the Department of Arts and Heritage and the Dublin Mountains Partnership.
"This is very good news for the whole country", Mr Ring said, adding that in this case Nama "are to be complimented for taking the national interest into consideration".
Almost 20,000 people had signed a petition calling on the Government to buy the land amid fears that sections could be developed for housing or wind farms. The land fell into Nama ownership after a developer who had owned it got into financial difficulties.
Nama had warned that the Government needed to move "quickly" to prevent the land being sold to a private party.
Dublin South West TD John Lahart, who had warned it would be "scandalous" to allow the mountainous terrain fall out of State ownership again, said local people would be relieved and delighted that a deal was about to be done.