Yet another UK company is set to leave the UK public markets after pawnbroker Ramsdens agreed to be acquired by a US peer.
FirstCash Holdings has agreed to buy Ramsden in a recommended cash deal worth up to around £206 million, marking the US pawnbroking giant’s second swoop on the UK market in as many years.
Under the terms, Ramsdens shareholders will receive 600p in cash per share, with dividends of up to 9p already declared, taking the total offer to 609p. The cash element alone values the business at roughly £203 million.
At 600p, the cash consideration sits 33% above Ramsdens’ closing price of 453p on the last trading day before the offer period began and a 46% premium to the three-month volume-weighted average of 412p.
Investors will be delighted, given that the company was trading at just 317p less than a year ago.
What’s interesting here is this looks to have been the acquisition of a growing business that is thriving as a UK-listed company – not an opportunistic swoop we sometimes see with US firms targeting listed UK peers.
FirstCash already runs more than 3,300 stores across the US, Latin America and the UK, and carries a market capitalisation north of $10 billion. It entered the British market last year with the acquisition of H&T, and Ramsdens slots neatly alongside it. The company describes the target as a “highly complementary” business that would cement its position as the largest publicly traded pawn platform across its three core regions.
Ramsdens itself is no pure pawnbroker. The Teesside-based group runs 174 stores spanning England, Scotland and Wales, with a diversified model covering jewellery retail, precious metals buying, foreign currency exchange and pawnbroking, plus a growing online arm. Much of its custom comes from people with limited access to mainstream banking.
Commenting on the Acquisition, Peter Kenyon, CEO of Ramsdens, said: “I am exceptionally proud of the Group’s transformational growth since our Initial Public Offering on AIM in February 2017. Less than a decade on, we have added 50 Ramsdens stores to the UK high street, created over 300 jobs and significantly grown our profit before tax. I remain highly confident that there are significant opportunities for further growth over the coming years.”
“FirstCash is an internationally established sector leader, and I share their confidence and conviction in the outlook for Ramsdens, which is underpinned by our diversified model and established reputation for consistently doing the right thing for our customers and our fantastic people.”