The administrators of Heart of Midlothian Football Club plc hope to reach an agreement this week with their counterparts in Lithuania that will secure the transfer of shares to the Foundation of Hearts.
The deal, which is likely to involve a nominal fee of up to £100,000, will be a crucial step towards the company exiting administration before the end of March.
The shares are currently owned by Ukio Bankas Investment Group, who hold 50%, and Ukio Bankas, who own 29.5%, with both companies being in administration themselves. A draft agreement is on the verge of being reached with the administrators in Lithuania, though, and the hope is that the paperwork will be finalised this week. Herald Sport understands that a first draft could be delivered to Tynecastle as early as today.
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Talks have been ongoing for some time and BDO, the HMFCplc administrators, believe that significant progress has been made. No deal has been finalised yet, though, but there is optimism at Tynecastle that a crucial step can be taken this week. It would allow BDO to begin involving the Foundation of Hearts in the decision-making process and to begin the process of finalising the share and purchase agreement that will fund the Company Voluntary Arrangement to take HMFCplc out of administration.
Creditors agreed to the CVA proposal last November. The agreement will result in Ukio Bankas - Hearts' largest creditor, with £15.5m of secured debt - receiving £2.5m, but UBIG, who held around £8.2m of unsecured debt, will receive nothing.
The agreement with the administrators in Lithuania is technical and complex but the hope is that the fee for the shares will come out of the £2.5m raised by the Foundation. BDO are pressing for this issue to be resolved to try to maintain a timetable that will result in HMFCplc coming out of administration before the end of March. There is currently enough funding to run the football club until then, but finances would become stretched into April and May. One potential delay remains, though; the fact that the administrators in Lithuania will ultimately need to receive court approval before the CVA can ultimately be agreed and that could take time.
A Foundation spokesperson said: "We are aware of today's reports. No deal has been done. We encourage everyone to remain focused on the task in hand."
While the players can do little to influence financial matters, they yesterday congratulated themselves on earning Billy Brown, the club's No.2, a reprieve after it had been announced he would be leaving the club after last weekend's match.
Jamie MacDonald, the goalkeeper, said they were hopeful the experienced Brown can help lead the club into a new era by staying on long-term. MacDonald, along with other senior players Jamie Hamill, Ryan Stevenson and the club captain Danny Wilson requested a meeting with joint administrator Bryan Jackson last week to discuss the matter. With the move angering the manager Gary Locke and with the League Cup semi-final against Inverness Caledonian Thistle imminent, the players were successful in persuading Jackson to retain Brown until the end of his contract on January 31. It is understood Brown will also take his place in the dugout for the semi-final on February 2, with Jackson indicating he could even stay on beyond that trip to Easter Road.
MacDonald said: "The boys are all delighted. It's a lot for the gaffer to take on just now, as difficult as this season has been. Even from the coaching side of things, we need as much experience as we can get. Billy has that in abundance.
"It's great for everybody, because Billy is great around the changing room. He has a real spirit. We're delighted that he's here for the next few weeks, anyway.
"It's probably wrong of me to say that I've enjoyed this season, it's been difficult. But day to day I enjoy coming in with [Gary and Billy] and most of the other boys do too. The team spirit's fantastic.
"We've maybe not had some of the breaks, a lot has gone against us, though we know a lot of that is our own fault. It's just the youthfulness of the side. But for the long-term of the club I'd be happy if the gaffer and Billy stayed."
There was positive news on the pitch too when it was revealed that Stevenson, the club's most experienced player, will be able to play against Inverness.
The 29-year-old picked up a two-match suspension courtesy of his red card in Saturday's 3-3 draw with St Johnstone, with the second of those games on the sidelines scheduled to be the League Cup semi-final. However, Stevenson will now have served his suspension by Sunday week after the Tynecastle club brought forward to next Wednesday the league fixture with St Mirren that was due to be played on February 1.
MacDonald added: "It's a boost for us that Ryan will be available because we need all the experience we can get and he's our most experienced player. It's great for Ryan because he was a bit gutted that he was going to be missing the semi-final. Now he's had a reprieve."