Jewellery retailer and financial services business Ramsdens has announced the strategic acquisition of 18 The Money Shop stores.
The listed group said the acquisition includes two stores in Yorkshire, in Rotherham and Bradford, and supports its strategy of extending its presence across the UK.
Ramsdens will pay The Money Shop's parent company Instant Cash Loans £1.5m in cash for the 18 stores.
The acquired stores will be rebranded as Ramsdens over the coming weeks and will include the full breadth of the group’s customer services.
The purchase price includes £400,000 of goodwill and £1.1m of assets. Ramsdens will acquire the pawnbroking loan books of the 18 stores and of five other The Money Shop stores which are set to close.
Ramsdens said the deal enables the group to leverage the significant investments made in recent years in its brand, IT systems and people.
The firm said there is significant potential to build on the existing foreign exchange proposition in these stores and to improve performance through the expertise of the group’s management team. In addition, Ramsdens will introduce its growing jewellery retail offering into the majority of the acquired stores.
Ramsdens will take on around 70 new employees as a result of the deal.
Peter Kenyon, chief executive of Ramsdens, said: “We are delighted to announce this value-enhancing acquisition and welcome our new colleagues and customers to Ramsdens.
"This acquisition further expands the reach of the Ramsdens brand and our trusted offering across communities in the UK and demonstrates the significant growth opportunities available to the group in the fragmented UK market."
He said that Ramsdens has a proven track record of acquiring stores and quickly integrating them into the group.
"We will now prioritise our resources on these acquired stores. We are confident that this acquisition will deliver value for the group’s shareholders as well as the local communities where they operate," he added.
The board anticipates that the acquired stores will make a small contribution to group pre-tax profit in 2020 after factoring in integration costs including those relating to refits, rebranding, training and IT integration.
It said the acquired stores should contribute around £600,000 to group pre-tax profit in 2021.