NEW YORK (CNN/Money) - A bankruptcy judge Tuesday blocked German media group Bertelsmann from buying Napster, killing a deal that might have revived the once-popular song-swapping service as a legitimate music-sharing network.

A Delaware court denied Bertelsmann's $9 million offer to creditors to buy Napster after record labels and songwriters opposed the deal, arguing it was not a fair price.

Judge Peter J. Walsh made the ruling in Wilmington, Del., following objections from two recording industry groups last week, according to Aidan Synnot, an attorney representing the National Music Publisher's Association (NMPA), a group of record labels and songwriters.

Bertelsmann had sought to purchase the remains of the defunct Napster network for an additional $9 million after having already sunk $85 million into the Redwood City, Calif.-based company to keep it afloat.

Napster, which once had a cult following of some 60 million, was forced to shut down last year after major record labels convinced a federal judge it violated copyright laws. Napster has been offline for more than a year and filed for bankruptcy protection in June.

Bertelsmann shocked the music industry by agreeing to buy Napster out of bankruptcy, with the aim of relaunching it as a legitimate subscription service.

But prospects for the service had already grown bleak after Bertelsmann CEO Thomas Middelhoff's ouster at the end of July. Middelhoff had been one of the few supporters of Napster within the media group.

A Bertelsmann spokesman said the company has accepted the decision and has abandoned its plans to purchase Napster.

As for Napster, Tuesday's decision virtually seals its fate.

"Napster is disappointed with the bankruptcy court's decision not to approve the sale of the company's assets to Bertelsmann," Napster CEO Konrad Hilbers said in a statement, adding that the company will probably be forced to sell off its remaining assets.

"As with most start-up technology businesses, Napster's technology is of little value without the talented team that created it, so it is an occasion of loss on many levels," Hilbers added.

Suits by several major record labels effectively destroyed Napster. Those record companies also filed motions in the bankruptcy case, vigorously objecting to the sale of the company to Bertelsmann.

The objections filed by record labels and songwriters and another filed by the Recording Industry Association of America last week requested that the Delaware bankruptcy court not include Bertelsmann's past loans in its bid.

Still, some industry observers believe Bertelsmann may still pick up some of Napster's assets out of liquidation. Under Chapter 7 liquidation, a trustee is appointed by the court to liquidate the assets.

Bertelsmann's new chief executive, Gunter Thielen, also finally shut the door on the group's main e-commerce business, BOL, on Tuesday. Bertelsmann said it was looking to exit its loss-making BOL businesses in Sweden, Switzerland, Germany and the Netherlands in an overhaul of its Internet operations.  

--from staff and wire reports