A 28-year-old man was arrested in Co Derry on suspicion of criminal damage and being in possession of a blade or pointed weapon in a public place.
He remained in custody on Sunday afternoon after police closed off the main street in Maghera following the report of a man was in possession of a knife.
Main Street was closed to traffic and pedestrians after police went to the incident at approximately 2.30am on Saturday.
Officers received a report that a man was carrying a knife on the street. A man, aged in his 20s, around six feet tall with fair hair and, police said, wearing a coat and hat. He had blood on his face.
“When approached by police, he made off in the direction of the Glen Road and a police chase in the area ensued,” a PSNI spokesperson said.
“A number of windows at a nearby licensed premises had also been smashed. Officers also located two knives outside the premises which have since been removed for further forensic examination.
While the alert was ongoing, and police were still searching for the man, the public was warned not to approach him.