Roxio offers $5m for bankrupt Napster's assets

The slow, lingering death of Napster, the internet trail-blazer, appeared close to ending yesterday when a company that produces CD-burning software offered to buy the defunct music-swapping site.

Roxio will pay just $5m (£3.2m) in cash for the bankrupt Napster – once reckoned to be worth hundreds of millions of dollars – plus $300,000 in shares. However, it wants to buy Napster's assets and intellectual property, free of its liabilities.

Potentially massive lawsuits are still pending from the major record labels against Napster because it allowed users to download their music for free. The US-based site was created by the then 19-year-old student Shawn Fanning and at one time boasted more than 70 million users.

Roxio's president and chief executive, Chris Gorog, said: "Roxio's acquisition of Napster will expand our role in the digital media landscape and enhance our offerings to consumers."

Mr Gorog promised more detail on his Napster strategy in the coming months. The bankruptcy court, which previously barred a sale to Bertelsmann, the German media giant, is expected to rule on the Roxio deal within the next couple of weeks.

Based in California and listed on Nasdaq, Roxio provides digital media software and was recently one of several digital distribution companies that signed a deal with EMI to allow consumers to legitimately download music. Napster – Mr Fanning's nickname at university – is still one of the most recognisable brand names on the internet. The major music labels, which blame online piracy for a dramatic drop in CD sales, took Napster to court for infringing copyright laws, shutting it down in July 2001.