Athletic shoe retailer Foot Locker Inc has signed a definitive agreement with Footstar Inc to purchase about 350 of its Footaction stores for $160 million in cash.

The deal, subject to Bankruptcy Court approval, follows Footstar's Chapter 11 bankruptcy protection filing early last month.

Foot Locker expects to close the transaction during its second fiscal quarter.

"The agreed upon purchase of the Footaction stores is in line with our previously stated strategic priorities, including the acquisition of compatible athletic footwear and apparel retail companies," Foot Locker CEO Matthew Serra said.

"Foot Locker Inc's strong financial position enables the company to readily complete this cash acquisition.

"It is expected that the proposed acquisition will be accretive to Foot Locker Inc's diluted earnings per share within the first full year of operation."

Serra said Foot Locker would try to retain the majority of Footaction employees at the 350-odd stores.

An approval hearing for the acquisition is scheduled for the Bankruptcy Court on April 21.