Roxio Inc. which makes CD-burning software, said on Friday it will buy substantially all of the assets of defunct song-swapping service Napster in a deal valued at $5.3 million.

The Nasdaq-listed firm offered $5 million in cash and 100,000 warrants in Roxio stock to finance the purchase. Roxio's shares ended Thursday's session at $3.38.

The deal hinges upon approval by the U.S. bankruptcy court overseeing Napster's assets, but a spokesman for Roxio in London said both parties have agreed to the sale terms.

If it is approved, Roxio would receive all of Napster's intellectual property including its technology patent portfolio, but Roxio is not assuming any of Napster's liabilities, including pending litigation, it said in a statement.

The court could rule on the deal as early as November 27, thus putting an end to the lengthy saga of the music industry's biggest nemesis in recent years.

At its height two years ago, Internet users traded tens of millions of songs across Napster's network, ushering in an era of rampant online song piracy in which CD-quality songs could be downloaded onto a computer's hard drive for free. Napster 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, essentially shutting it down in July, 2001.

The Napster phenomenon, though, triggered an explosion in Internet file-swapping. Newer advanced services such as Kazaa and Morpheus MusicCity enable Internet users to trade all manner of copyrighted materials from songs to video games and movies.

Napster, which closed its operations in September, reached a deal late that month with the U.S. Trustee's office for the appointment of a Chapter 11 trustee to manage its estate.

More that a dozen bidders, including Barcelona-based adult entertainment company Private Media Group (PRVT), emerged to purchase the assets of Napster.