Two men are recovering from smoke inhalation and shock after being tied up at the back of a bar in Co Down before the premises was set alight.
Four masked men entered McCoy's Bar at Kilmorey Street, Newry at 12.30am, tied up two members of staff in a rear yard, and set the premises ablaze
The two men, who were trapped, were rescued by firefighters and treated in hospital.
Up to 60 firefighters and 12 fire engines tackled the fire overnight.
It is understood a fight broke out less than an hour before the fire started and a television and window were broken.
Local SDLP MLA Dominic Bradley said the two trapped men had a lucky escape.