Swedish underwear brand Björn Borg has acquired the shares of Baseline, in the subsidiary of its sports division, marking the first step of its relocation to Stockholm.

The company said it plans to increase its strategic focus on sports fashion and this transaction is a natural step to strengthen control over the sportswear operations.

The shares acquired from Baseline represent 49.58% of total shares in Björn Borg Sport. After the acquisition Björn Borg will hold 99.63% of outstanding shares in the company.

The company will pay a purchase price for the shares, comprising a fixed purchase price and a variable purchase price based on future purchases of sportswear products in 2015-2017 by Baseline group, holding the distribution right for Björn Borg sportswear in Benelux. It is estimated the total purchase price will not exceed EUR700,000 (US$858,835).

The wind down of the Netherlands operations is expected to entail some one-time cost implications, estimated at no more than EUR750,000.

"Our market surveys show that consumers want a higher fashion level in their sportswear and that there is a great interest in buying sportswear from us. It is our job to cater to that. With 90% -100% brand recognition in our main markets we have a solid foundation to build upon. This transaction is a natural step in our increased focus on sports fashion," said Henrik Bunge, CEO of Björn Borg.