The £2.5 billion bank-backed Business Growth Fund (BGF) has continued with its busy 2014 period by investing in GYMBOX.

As the brainchild of Richard Hilton, GYMBOX now has five sites in London – offering its own brand of fitness packages. Describing itself as a ’boutique’ chain, GYMBOX has individually designed gyms, nightly resident DJs and classes ranging from rave dancing to karaoke spinning.

The £10 million investment has been raised so that Hilton, who has a background in marketing at brands such as Nike and Unilever, and GYMBOX can open in new locations. Away from its five current locations, a further three have been secured in London.

Hilton, managing director at GYMBOX, comments, ‘The GYMBOX brand has gone from strength to strength in recent years based on our contemporary club designs, exciting and original classes and our ability to offer customers new and unique ways of keeping fit.

‘We look forward to opening new sites this year and next and introducing the GYMBOX concept to a wider audience in London and other UK cities.’

As a generalist investor making commitments of between £2 million and £10 million, the backing of GYMBOX is not the first time that the BGF has closed a deal in the UK fitness market. Back in August 2013, the fund added Xercise4Less to its portfolio through a deal worth £5 million. The gym chain, set up by former rugby league player Jon Wright, then returned to its backer in May of this year for a further £2 million.

More on other leisure and hospitality deals by the BGF:

• Rutland Cycling rides of with £2.8 million investment
• Spanish restaurant chain served up BGF funding

GYMBOX is forecasting a turnover of £10 million and EBITDA of £3.5 million for the year ending October 2014 from a growing membership base of 13,400.

As part of the deal, Paul Campbell, chairman of steak restaurant chain Hawksmoor, is joining as non-executive chairman to advise on leisure roll-outs. Figures from The Leisure Database Company finds that the UK gym market was worth £3.92 billion in 2013, fuelled by ‘nimble’ low-cost and upmarket gyms taking market share.

Alistair Brew, investment director at BGF and new board member at GYMBOX, adds, ‘We saw this as a fantastic opportunity to back an ambitious and proven management team in the roll-out of a successful and differentiated gym business which has had impressive success to date.

‘Richard is a driven and committed entrepreneur whose track record of site selection, which is key in roll-out programmes of any nature, has been outstanding.’