Scottish Premier League (SPL) outfit Heart of Midlothian is poised to go into administration, the club has confirmed.
The crisis-hit club has lodged papers at the Court of Session in its home city of Edinburgh and is understood to have approached accountancy firm KPMG to act as its administrator. A club spokesman told the Press Association Sport news agency: “We are not in administration yet but we have served our intention to appoint administrators.” A hearing is expected to take place this week, with a number of Hearts’ creditors informed of the latest developments.
Monday’s news comes after Hearts were last week faced with a winding-up order as Her Majesty’s Revenue and Customs (HMRC) threatened action over an unpaid £100,000 tax bill. The majority of that sum has since been paid, but the club was then placed under an immediate transfer embargo by the SPL after admitting it could not afford to pay its players. Hearts’ board on Thursday issued a statement saying that it had entered a “critical” stage in its bid to pay off debts of £25 million, along with financing tax and running costs. Hearts reportedly needs to raise £500,000 to see it through to the start of the 2013-14 season and last week placed its entire playing squad up for sale.
Hearts owner Vladimir Romanov claims to have invested around £60 million in the team, but he first announced his intention to sell the club in 2011 after becoming increasingly disillusioned with football. The status of the two Lithuanian companies which hold large stakes in Hearts has also increased fears for the future of the club. Majority shareholder UBIG owns a 50% stake in the club and Ukio Bankas a 29.9% share. Both were once controlled by Romanov but are poised to be declared insolvent by Kaunas-based authorities. Ukio Bankas lost an appeal against liquidation last week and is due £15 million by Hearts, who also owe another £10 million to UBIG.