British pawn shop giant Ramsdens has agreed to a £203million takeover by US rival First Cash in a fresh setback for London's stock market.

The Teesside-based group, which runs 175 shops in the UK as well as operating online, said it had agreed to the bid because it was vulnerable to changes in the price of gold and 'further economic pressure'.

Being owned by First Cash, which runs 3,330 sites across the US, Latin America, and the UK, is a way of 'reducing risk' for shareholders, Ramsdens said.

The 609p per share offer represents a 35 per cent premium to Ramsden's closing share price on Monday.

It is the latest in a series of takeover attempts by overseas bidders on British publicly listed companies in recent weeks.

The update came just a day after airline Easyjet snubbed an offer from US investment group Castlelake, deeming it to be 'highly opportunistic' after shares had taken a hammering amid the war in Iran.

Shares in Ramsdens soared 30 per cent after the announcement.

Ramsdens non-executive chairman, Simon Herrick, said that the group had delivered a 'consistently strong performance' with multiple profit upgrades over the past year.

But he added: 'Unfortunately, the share price has not fully kept pace with the group's positive profit and earnings per share growth and FirstCash has made a cash offer for the group which represents a 35 per cent premium to the current share price.

'The board, following independent advice from Cavendish as to the financial terms of the acquisition, considers the acquisition to be recommendable to our shareholders.'

Ramsdens currently trades on London's junior AIM market. 

The board also believes that the group's future performance is 'subject to a range of external factors and risks,' a statement said.

While the recent strength in the gold market has been 'a supportive factor and an important part of the positive trading momentum delivered by Ramsdens over the last 12 months,' any reversal could 'adversely' impact trading, it said.

The company also said that 'the broader UK macroeconomic outlook remains uncertain, adding that: 'Elements of the business may be susceptible to further economic pressure.'

The remarks come just a day after Prime Minister Keir Starmer announced his resignation, triggering more uncertainty for businesses. 

'Taken together, these considerations introduce a degree of risk to the deliverability of Ramsdens' medium-term aspirations,' it said.

Last year, First Cash bought Britain's largest pawnbroker, H&T, for £297million.

Ramsdens chief executive Peter Kenyon added: '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.'