HEARTS are in grave danger of plunging into administration because of a financial crisis so severe the club may not be able to pay an outstanding tax bill or all of the wages which are due to players and staff today.
The entire Hearts squad was openly made available for sale yesterday as the club also admitted nearly all of the money raised from selling almost 7000 season-tickets for 2013/14 had already been spent on trying to address a chronic cash shortfall. A statement outlined the club's belief that hesitation and inaction from supporters – namely in buying fewer season tickets than the club had anticipated – had resulted in too little money coming into the club. Fans, though, generated £1.1m in a share issue to keep the club going only six months ago.
Hearts owe £15m to Ukio Bankas, a sum which will not be immediately called in by the troubled Lithuanian bank's administrators. A further £10m is due to Ukio Bankas Investment Group, the club's parent company which is believed to be on the brink of insolvency. If it, or Hearts as a club, go into administration the club will start next season in the new Scottish Professional Football League with a 15-point deduction. Her Majesty's Revenue and Customs could also seek a winding-up order because not all of a £100,000 tax debt, due on Tuesday, was paid.
David Southern, Hearts' managing director, was at a Scottish Premier League meeting at Hampden when the club released a statement about its dire condition yesterday morning and admitted that the situation was serious. "The club is in a bad place," he said. "We're just going to have to try to get through the situation and reach the start of the season, when the income streams will hopefully start flowing again."
Asked if the club could pay the wages which are due today, Southern said: "Well the end of this week is tomorrow [Friday]. A day is a long time in football so we'll cross that bridge when we come to it. It is a doubt at the moment, yes.
"We would be hopeful of getting through the summer but it will require a significant effort. What we do over the next few days is going to be very important for the future of the club.
"Most of it [the season ticket money for the coming campaign] is accounted for. We always knew there was going to be a dry spell through June and July."
Hearts offered a three-year contract to former Liverpool defender Danny Wilson which was agreed on May 27 but now he will become one of the most valuable assets at the club. Although Hearts are under an SPL registration embargo, no new registration was required when Wilson's loan deal became a permanent move, so he is registered and available for sale along with all the others.
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