A US court has hammered the final nail in the coffin of maverick music service Napster when it blocked a bid by German media group Bertelsmann AG to buy the now defunct website.
Killing off a deal to revive the bankrupt service that millions of fans used to swap music over the Internet, a US bankruptcy court rejected Napster's sale to Bertelsmann after record labels and songwriters opposed the deal, saying the offer price was not fair.
Faced with no financing, no revenues and no other buyers, Napster said it would most likely be forced into Chapter 7 liquidation, ceasing operations altogether and terminating its remaining employees.
Napster, which once commanded a devoted following of some 60 million fans downloading free song files from its central servers, was forced to shut down last year after major record labels convinced a federal judge it violated copyright laws.
But Bertelsmann's former CEO Thomas Middelhoff shocked the industry by agreeing to buy Napster out of bankruptcy, with the aim of relaunching it as a legitimate subscription service.
Bertelsmann offered $9 million for Napster's remains on top of some $83 million already sunk into the site, but record labels and songwriters argued it was too little. The German group said it would no longer pursue the acquisition.
"As a result of the record companies' and music publishers' opposition, Napster's creditors will be denied substantial repayment and the company will likely be forced into Chapter 7 liquidation," Napster CEO Konrad Hilbers said in a statement.