EVENTS during the last 48 hours leave Foundation of Hearts favourably placed to strike in their bid to gain control at Tynecastle. Tonight, they hold a question-and-answer session in the stadium’s Gorgie Suite, with many fans doubtless eager to see if the Foundation have what it takes to negotiate a takeover.
Ukio Bankas’ administrators stated on Wednesday that they will help facilitate the sale of Hearts if possible, despite the bank being liquidated and owed £15 million by the Edinburgh club. Ukio has a claim to almost 30 per cent of Hearts’ shares as well as Tynecastle itself. Yesterday, the club hierarchy released a statement saying all players are for sale because they urgently need cash to pay wages and an outstanding tax bill. Financially, Hearts are on their knees and the Foundation have a chance to seize their moment as a result.
They plan to lodge a formal takoever bid before the end of this month, which would realistically need to be around the £6m-£7m mark to satisfy the Ukio adminstrator. They would then need to reach agreement over the £10m owed to parent company Ukio Bankas Investment Group (UBIG), which is on the brink of insolvency.
The Foundation intend to run Hearts on behalf of fans through a membership scheme, where supporters would pay monthly subscriptions. More than 4000 have already pledged money through the Foundation of Hearts website, including former players like Rudi Skacel, Ryan McGowan, Danny Grainger and Darren Barr.
The Evening News has learned that Ann Budge, the multi-millionaire involved with the Foundation, could inject some money towards a takoever bid but will not bankroll all of it. Tonight, the Foundation’s independent chair Ian Murray will face questions on the strength of the group’s finances and how they plan to go about seizing control of Hearts.
“I believe if the Ukio Bankas administrator were to achieve something around the £7m mark, he’d be doing well. I’m not expert on the matter but that’s what people who are experts tell me,” said George Foulkes, the former Hearts chairman who pledged £100 a month to the Foundation.
“Wages and outgoings are down so Hearts are moving towards being a profitable business. That means, for someone, Hearts could be a decent investment. I would hope we can end up at some stage with the Foundation of Hearts holding 51 per cent of the shares and an investor holding a smaller stake. Whether we can get to that depends what happens over the next few weeks, which are really critical.
“Some fans will be sceptical at the meeting. It would be a comfort to the people who are sceptical if there was a balance between an investor and the Foundation. That’s why I think 51 per cent Foundation of Hearts and a private investor holding slightly less. It may need to start with a private investor holding a bigger share and transferring it to the fans over a period of time. That would allay some fears.”
Whether Budge is willing to be that private investor has yet to be established. The Scandinavian consortium credited with an interest are open to a joint bid with the Foundation and have cash to offer. Either way, to realise their plan, the Foundation must submit a takeover bid acceptable to all parties with a vested interest in Hearts. And there are many.
There is UBIG, then Ukio Bankas (controlled by administrators Valnetas UAB) and then the Hearts board. Despite his assets being frozen and the fact he is in hiding under the protection of the Chechen president, Vladimir Romanov may also have some input. Negotiating a way through that minefield and presenting a serious bid is vital to the Foundation’s credibility. Another American consortium wait in the wings but the Foundation is well placed now.
“I’m very keen to see fan ownership,” said Foulkes. “I’ve been enthusiastic about that for a while. Some months ago, I made the maximum pledge of £100 a month to the Foundation of Hearts as an indication of my support. I thought I’d put my money where my mouth was. The pledges which, when converted into cash, will provide a continuous income. That is a good sign for future ownership. The choice of Ian Murray as the independed chair of the Foundation and other fans’ groups was a very good one. Ian is a long-term Hearts supporter. He used to travel to away matches on the Longstone bus when he was young so he is a real enthusiast. He is also a very shrewd businessman as well as a politician. That is unusual, particularly for a Labour politician,” laughed Foulkes, who is a member of the same party.
“All the organisations must unite for the good of the club. The one thing people remind me of, which may be a problem, is what happens during lean times. If the club doesn’t manage to sell players and things are going badly, the capital isn’t easily available. I think the ideal situation - whether we can achieve it or not I don’t know - is a combination of fan ownership and someone who sees it as an investment and can inject some capital. When I tell people in London we raised over £1m in our share issue, they are staggered. I think we have huge untapped potential.”
Foulkes helped Romanov gain control at Tynecastle in 2005 but is now desperate for the end of his reign. “He was the only choice at the time because no-one else stepped up,” he said. “Romanov did good things and bad things. We won the Scottish Cup twice and were in Europe regularly. Not many clubs in Scotland could say that. He also did some daft things, wasting a lot of money and upsetting a lot of people, including me, unnecessarily. His time was up some years ago and I think everyone will be glad that we won’t see him again.”