Budget gym operator Xercise4Less hopes to launch 15 new sites across the UK this year, after securing a £5.5m package to fund the company’s next phase of expansion.

The Leeds-based company operates 15 gyms in the north of England, and now hopes to enter the Scottish and southern English markets as part of its ambition to reach over 100 sites in the next five years.

The news comes hot on the heels of expansion announcements from budget sector rivals énergie and the soon-to-be-merged Pure Gym and The Gym Group, suggesting both growth potential and fierce competition show no sign of relenting at the lower-priced end of the gym market.

The £5.5m package was secured from Lloyds Bank Commercial Banking and follows a £5m equity investment from Business Growth Fund (BGF) in 2013 to facilitate the Xercise4Less growth strategy.

Jon Wright, CEO of Xercise4Less, said: “This further support from Lloyds Bank will enable us to accelerate the rollout of our large format budget gym offering which is deep rooted in providing the best variety of equipment at the lowest price to our customers.

“We have already handpicked excellent locations in a number of regions throughout the UK where we plan to launch and hope to continue this momentum to expand to over 100 sites in the next five years.”

The gym operator, which was founded in 2006, received legal advice for the transaction from Addleshaw Goddard (Lloyds Bank), Walker Morris (Xercise4Less) and Squire Sanders (BGF).

“The budget gym sector continues to grow strongly and Xercise4Less is well placed to capitalise on the strong demand for reasonably priced, high quality fitness facilities,” said Lloyds Bank Commercial Banking director in the strategic finance team Martin Beckett.

“This deal reinforces our belief in the management team’s growth strategy for the company, which we have supported since it began in 2006.”

To read an interview with Xercise4Less CEO Jon Wright from September 2013's Health Club Management magazine, click here.