Target Information

Oxygen Freejumping is the leading operator of trampoline parks in the UK, specializing in recreational and fitness activities that include Freejumping, gymnastics, and parkour coaching. The company has quickly established itself in the leisure industry with the launch of its first trampoline park in West Acton in summer 2015 and a second location in Southampton in December 2015. With ambitions to open 30 parks within two years, Oxygen Freejumping is poised for significant growth in this competitive market.

Industry Overview in the UK

The leisure sector in the UK is experiencing rapid evolution, with trampoline parks emerging as a popular destination for families, children, and fitness enthusiasts alike. This growth is accentuated by a rising health consciousness among consumers, which has translated into increased participation in physical activities and sports during leisure time.

Moreover, the trampoline park industry is benefiting from trends in experiential leisure activities, where people seek unique and engaging experiences over traditional entertainment. This has created an attractive marketplace for businesses that can provide not just fun, but also fitness-oriented activities.

As part of a broader trend, the UK's health and fitness sector has seen a similar acceleration, mirroring the success of trampoline parks. Innovators and entrepreneurs are capitalizing on this momentum, increasingly attracting investments to further expand their reach.

The UK government continues to support the leisure and fitness industry, recognizing its contribution to health and wellbeing, as well as economic growth. This regulatory backing, paired with the active consumer interest, positions the industry for sustained progress and profitability.

Rationale Behind the Deal

The investment from Beechbrook Capital, which includes a loan and equity injection, comes at a pivotal moment for Oxygen Freejumping as they expand their operations across the UK. The funding will facilitate the acquisition of five new sites, totalling 162,000 sq ft, with locations in Derby, Wigan, and Trafford Park, Manchester, set to offer a comprehensive range of recreational options.

With such strong demand for unique leisure experiences, this strategic investment reinforces Beechbrook's commitment to supporting innovative businesses with capable management teams and a demonstrated potential for growth. The company aims to leverage Oxygen's existing brand presence and outstanding safety records to capture market share in this growing sector.

Information About the Investor

Beechbrook Capital is an investment firm that primarily focuses on providing loans and equity financing to SMEs across the UK. This particular investment marks the first deployment of capital from their newly launched UK SME Credit Fund, which raised £103 million in its initial close. The firm aims to identify and back businesses with strong growth potential and a competent management team.

Jon Herbert, Managing Director of the UK SME Fund at Beechbrook Capital, expressed enthusiasm for the partnership with Oxygen Freejumping, underlining the strength of the management, the quality of the product offerings, and the historical performance of the business as key factors influencing their investment decision.

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Given the burgeoning popularity of trampoline parks in the UK, this investment by Beechbrook Capital into Oxygen Freejumping could signify a highly strategic move. The UK leisure market, particularly the trampoline sector, exhibits a robust growth trajectory, and Oxygen’s ambition to have 30 parks operational within two years indicates a strong growth strategy.

The deal’s success is likely to stem from several factors, including the experience of the management team and the company's existing reputation for quality and safety, which are paramount in the leisure industry. The substantial infrastructure investments aimed at expanding their presence can provide Oxygen with a significant foothold in the UK market.

Furthermore, with the leisure industry on an upward swing driven by consumer preferences for more active forms of entertainment, Beechbrook's investment aligns well with future market demand. Successful execution of this expansion plan could yield substantial returns, making this a promising investment opportunity.

In conclusion, while the initial risk exists with any startup expansion, the combination of market positioning, management expertise, and a solid investment structure creates a favorable outlook for this deal, indicating it could indeed be a wise investment decision for Beechbrook Capital.

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