July 30 (Bloomberg) -- Foot Locker Inc., the largest U.S. athletic-shoe retailer, put itself up for sale and forecast its first loss in six years after increasing discounts.

The shares fell to their lowest price in 3 1/2 years.

The company said today in a statement that it received inquires from buyout firms and hired Lehman Brothers Holdings Inc. for advice on strategy. Foot Locker spokesman Peter Brown declined to comment further.

Foot Locker said its second-quarter net loss will be 17 cents to 20 cents a share. The New York-based company in April unsuccessfully bid $1.2 billion to acquire Genesco Inc. to add the Johnston & Murphy and Journeys chains as customers buy fewer athletic shoes in favor of more general-use footwear.

``Casual trends and lack of hot marquee products are hurting performance categories,'' wrote Jeffrey Edelman, an analyst with UBS Securities LLC in New York, in a note today.

Second-quarter sales at stores open at least a year may fall as much as 8 percent, Foot Locker said. The retailer had previously forecast net income of 15 cents to 20 cents.

Foot Locker stepped up liquidation of slow-selling products at its U.S. stores at a cost of about $55 million, or 22 cents a share.

Foot Locker also said it will close as many as 250 of its 4,000 stores this year, double the original plan. In addition, most of its 30 Footquarters stores, which feature less expensive shoes than Foot Locker locations, will be converted into outlet stores, while a few will become Champs Sports units, Brown said.

The shares fell 25 cents, or 1.3 percent, to $18.80 at 4:03 p.m. in New York Stock Exchange composite trading, its lowest price since November 2003. They have declined 10 percent since July 19, when the New York Post reported that Foot Locker hired Lehman Brothers.

Analysts' Estimates

Eight analysts surveyed by Bloomberg had estimated average profit of 16 cents for the three months that end Aug. 4. Foot Locker will report earnings on Aug. 22. The company last posted a loss in the second quarter of 2001.

Last year, U.S. sales of running, basketball and tennis shoes each fell while skate and ``low performance'' shoes sales rose, according to Port Washington, New York-based NPD Group Inc.

Foot Locker hired Lehman Brothers when it first bid on Genesco in April. Smaller competitor Finish Line Inc. eventually agreed to acquire Genesco for $1.5 billion.

Last August, Foot Locker said it had hired Evercore Partners as an adviser without being more specific.

Foot Locker was started in 1974 as a unit of Woolworth Corp., the discount general-merchandise retailer founded in 1881. Woolworth, which shuttered its F.W. Woolworth stores in 1997, changed its name to Venator Group Inc. in 1998 and to Foot Locker Inc. three years later.

To contact the reporter on this story: Kevin Bell in Toronto at Kbell2@bloomberg.net; Danny King in Los Angeles at dking19@bloomberg.net.

Last Updated: July 30, 2007 16:14 EDT