Hearts face critical week amid liquidation fears

Gary Locke watches over training ahead of tonight's home game against Aberdeen
Gary Locke watches over training ahead of tonight's home game against Aberdeen
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Gary Locke admitted today that Hearts face the most critical week in their 140-year history awaiting news from Lithuania on whether they can avoid liquidation.

Should creditors at the club’s eastern European shareholders fail to release 80 per cent of shares to prospective owner Ann Budge this Monday, Hearts may be forced into receivership within weeks.

The Edinburgh club’s future rests on the outcome of creditors’ meetings at Ukio Bankas and Ukio Bankas Investment Group (UBIG), both scheduled for Monday, April 7. Locke has held talks with Hearts’ administrators BDO, who are eager to finalise a Company Voluntary Arrangement (CVA), agreed in November to transfer shares. The manager is aware that the next few days are crucial to his team’s very existence, with cash to run the club due to run out at the end of the month.

He explained today that no other week in Tynecastle’s past has been as pivotal as this. “It’s the biggest week in the club’s history, there’s no doubt about that. There is a decision to be made about the future of Heart of Midlothian and it’s a massive week for everyone,” Locke told the Evening News.

“Everybody at the football club can try to influence things on the pitch but our biggest battle was always off the field. It’s getting to the stage now where it’s becoming pretty critical. Hopefully, on Monday, we get the good news we’re all hoping for.

“This is a huge football club with an unbelievable fanbase. This club means a lot to all of them, so hopefully the people in Lithuania can make the right decision and we can move on. I spoke to Bryan Jackson [BDO administrator] last week and all season he’s been optimistic he can get the deal done. I’m 100 per cent behind him.”

Hearts’ impending relegation to the SPFL Championship could be confirmed tonight if Aberdeen win at Tynecastle, but Locke stressed that the club’s long-term future is a far more important issue.

“The bottom line is, we’ve got to make sure this club is still here. That’s the biggest battle. Everything was really positive with the news about Ann coming in. I know there’s been a lot of negativity in the media over the last couple of days, and it is a worrying time for everybody at the club.”

Jackson confirmed he could be forced to liquidate Hearts if creditors in Lithuania do not vote to release the club’s shares. Some creditors are unhappy with an offer of almost £100,000 to UBIG for their 50 per cent stake and want more money. Ukio, who hold 29.9 per cent of shares, stand to get all of the £2.5m from the CVA. They are Hearts’ only secured creditor and hold security over Tynecastle, so UBIG have been made a token offer for their shareholding.

Jackson said: “This is probably the lowest ebb. This deal should’ve been over the line by now. We have to accept now that there is a threat of liquidation and we are doing everything we can to avoid it.

“It is in absolutely nobody’s interest – whether it’s a creditor or a shareholder or a supporter – it can’t be in anybody’s interest, it just doesn’t make any sense, and this is what we are struggling with. We just have to make sure it doesn’t come to that.

“It does seem there are one or two creditors who want more information or are not happy with the deal and think the property is worth more money and so on. But that is not the reality.

“We have supplied all the information and we really don’t believe there could be a better deal. I don’t believe that trying to sell off the ground in any other way would benefit the creditors.

“But it’s a different country, with a different way of doing things. If there is a time delay that we could perhaps fill in with some funding; we have various options on how we could obtain that.

“None of the options are good if the deal doesn’t go through quite quickly. So it’s very hard to focus on plan B when, quite frankly, there isn’t really a good plan B.”

On a plan B, Jackson added: “Unfortunately, I would have to go back to the fans and the Foundation of Hearts and make the usual appeal. I know supporters have been stung time and again but I don’t think there will be anywhere else for me to go.”