Vienna’s Leopold Museum agreed to pay $5 million to the granddaughter of Jenny Steiner, a Jewish silk- factory owner, to keep in its collection a painting by Egon Schiele that was stolen by the Nazis.

The 1914 painting, “Houses by the Sea,” belonged to Steiner until she fled Austria in 1938, shortly after the Nazis marched into Vienna. She escaped to Paris and later emigrated to the U.S. with her two daughters. The painting was seized and sold by the Nazis, then later auctioned. Rudolf Leopold, the founder of the Leopold Museum, acquired it in 1955, the museum said in a statement published today on its website.

“After long negotiations, we succeeded in finding a fair and just solution,” the museum said. “Both sides went to great lengths to find a definitive settlement.”

The Leopold Museum owns 44 Schiele paintings and 180 works on paper, the biggest collection of the artist worldwide. During Rudolf Leopold’s lifetime -- he died on June 29 last year at the age of 85 -- the museum argued that as a private foundation, it was not subject to Austria’s restitution law, which only applies to federal government museums.

After Leopold’s death, his son Diethard Leopold pledged to settle all outstanding claims for Nazi-looted art in the museum’s collection as quickly as possible.