Hearts’ situation made clearer by administration

FOUNDATION of Hearts chairman Ian Murray insisted last night that no-one wanted the Tynecastle club to plunge into administration, but accepted that such a situation could at least make a murky financial picture clearer.

Speaking before an open meeting attended by around 300 supporters in the Gorgie Suite at the ground, the Member of Parliament for Edinburgh South admitted last night that he was “scared” by what his organisation might find when they complete their investigation into the club. But he insisted that the Foundation was still on course to make a takeover bid for Hearts by the end of the month.

“Due diligence isn’t going to be quick,” Murray said. “To be honest, we’re worried about opening some drawers – and worried about what we might see in them.

“Nobody wants the club to go into administration: there is a significant human cost. People tend to think football clubs are about scoring goals, but there are 150 staff in these buildings and we don’t want them to suffer administration. But certainly, if [administration happened] then there would be some certainty around those drawers. Even the liquidator of Ukio Bankas does not know what the position is with UBIG, so perhaps some clarity would help.”

Ukio and UBIG – separate companies both once owned by Vladimir Romanov – hold the key to Hearts’ future. Ukio have 29.9 per cent of the shareholding and are owed £15million by the club, while UBIG have 50 per cent and are owed £10m. UBIG are still officially the parent company of Hearts, but are themselves close to collapse. As if that position were not bad enough, Hearts are still in arrears with their tax payments and staff salaries, and this week put the entire playing squad up for sale in a bid to raise cash.

“Recent events do not really affect anything in the sense that it is pretty much the inevitable end game of what has been going on for some time,” Murray continued. “Some clarity has been provided: what it might do is give a little bit of impetus for people to pledge who might have been reluctant. We are now in a position to say: ‘If you didn’t think the club was in trouble, now you know!’ It is time to move forward with this stuff.

“Nobody wants to liquidate any company. That is a disaster, particularly a football club, but it has happened in the past. These things happen, but it is not our role to speculate – our concern is to have a bid on the table to take forward to any administrator, liquidator or owner.

“[Administration] is something that is completely outwith our control. We are working as hard as we possibly can, a group of 12-20 people working in our spare time trying to get something together. I think the progress we have made is significant and all we can do is get something together as quickly as possible. Anything which clears up the ownership of the club certainly helps.

“We will put a bid together on the basis of what we’ve got. If that’s acceptable, fine. If not, we may have to come back and encourage more people to pledge.

“The club is on its knees. It’s £25m in debt and it looks as though the future is very bleak indeed. I think the value of this football club, at the moment, is what someone is willing to pay for it.

“We are still planning to bid by the end of the month. We’ve got some assumptions that we’re meeting in terms of pledges and an annual revenue stream. So we’re working on that.

“We do have a target by the end of the month. If we don’t get there, it’s still important that the bid is right.”

Murray refused earlier in the week to reveal how much he planned to bid for the club, and last night he explained why that was the case. “We’re not giving out an exact figure. If we do that, it then becomes the base line of any bid.

“It doesn’t take a genius to figure out that, if we’ve got 4,000 at £10 a month it’s £40,000 a month.

“The reason we can’t give a figure is we need to put the deal together. Also, if the public think we’ve raised too much, they’ll stop pledging. If they don’t think we’ve raised enough and we’re not at the races, they’ll stop pledging, as well.

“That’s just the way the business strategy has to work for us to put a bid together.

“There is a long, long process to go before any transfer of ownership happens. But certainly, if we get a bid on the table, that’s the biggest hurdle.’

Murray refused to speculate on whether a Scandinavian group who have expressed an interest in making a bid had enough money to do so. But he did say that the Foundation would not rule out possible involvement with external groups or individuals if their interests coincided with those of the club.

“We are not necessarily the only show in town. The Foundation will support any bid that is in the best interest of this football club.

“I think the expectation among the fans is just that we can have a team on the park playing at Tynecastle next season. If that can be fulfilled by someone with the best interest of the club at heart coming in.

“If that is a new owner coming in that wants to work with us then we will do that. If they want to do it on their own and have the wherewithal to do that, then we will back them.”

Before Murray chaired a question-and-answer session, the audience heard brief speeches by former player Gary Mackay and leading members of the Foundation such as Iain MacLeod.

Taken from the Scotsman