Tag Archives: Brian Jackson

One Team in Edinburgh?

23 Jun

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Hearts must be in trouble. Reports of Gary Locke contacting Ally McCoist looking from a glamour friendly game to raise funds for the beleaguered Gorgie club. Smacks of desperation.

The hypocrisy involved in Jam Tarts fans paying to see a club that they said they didn’t need and didn’t want to know this time last year to benefit their club. There are so many U turns happening in Gorgie that Hearts should rent out the Tynecastle pitch for the Waltzers! As for Rangers fans turning up to help Hearts, No chance. What next Stuart Regan and Neil Doncaster being paraded at Ibrox to be welcomed as returning heroes!

Ally I am sure is sympathetic to Gary Locke and staff. The Rangers Manager and Staff after all have first hand experience. Ally is a professional well liked guy and will be kind to any Hearts request but in Ally’s and anyone at Rangers mind the answer surely has to be a polite no. The fiasco that lead Rangers to start last season with not one pre season game will I fear be remembered in Ibrox. No one was willing to stump up a team for Rangers to play last year and that was not games for profit, Rangers wanted games for sporting fitness. Rangers only played in Brechin in the Ramsdens Cup due to a hastily cobbled together temporary license for SFA.

Now Heart of Midlothian Football Club seem like they are in their death throws. Poor season ticket sales, credit/debit card issues have left sales on the pittance scale rather than selling like hot cakes. Is this forgotten promises from fans or a administrational nightmare?

A CVA seems to be the last chance saloon for the Gorgie Faithful, a bar full of Administrators sounds like the least fun place you could go for a pint but I bet Gary Locke is on all the fruit machines hoping to win big. Hearts situation has now went international, around the CVA table will be representatives from Lithuanian Administrators for UBIG group. The mess is such that we now have Administrators talking to Liquidators about a CVA. Add in HMRC and you have a nightmare of figures. The Lithuanian accountants have to get all the money in to pay off a country faced with bailing out a Bank! The HMRC have to do the same. This does not sound like a amenable compromise situation for BDO. It seems with so many legal vested interests in the room that a compromise to find a pence in the pound Company Volunteer Agreement is less than realistic.

Tynecastles only assets some players and a stadia. Players who guided by SPFA will legally be able to sign for who they like as soon as a CVA fails and liquidation kicks in. Therefore the only asset is a area of prime real estate in expensive congested Edinburgh. Allied to administrators/liquidators legally empowered to get as much money as possible for creditors. The threat of Heart of Midlothian being disassembled is real. This could happen not for petty vendettas but because of a legal duty.

So Hearts liquidate and look towards G51 for a template for recovery. This template has been set by Rangers, SFA and SFL so the SFPL will obviously follow the same proceedures. Hearts will leave newly published fixture list to be replaced by Morton and the knock on will follow down the league’s as happened last year. Hearts will enter the 4th tier. The mantra will be to try to follow Rangers up the league’s. Hoping along the way that Hearts and Tyncastle don’t part company. Surely that’s an option?

Well no. Rangers have a vastly increased fan base than Hearts. This made Rangers, its brand and assets attractive to investors and media sponsors. Even with local and die hard support a Newco Hearts would struggle. Tynecastle is by far the biggest asset or to be exact the land Tynecastle sits on is prime for development. The spectre of property developers asset stripping haunts Hearts. The sale of its spiritual home means the heart will be stripped from Hearts.

That’s attractive to investors but a nightmare for Jam Tarts dwindling fans. Homeless, potless and languishing in the lowest division Hearts would be lucky not to become Clydebank or Third Lanark.

The recently new formed pyramid system voted in by Hearts and others means Hearts surely now if liquidated would go into the newly created LOWLAND LEAGUE!

This makes Hearts now what can best be described as suspect statements given to authorities two days before the end of last season that they were financially ok in spite of UBIG administration a folly. In addition the recent events at Tynecastle bring into question the validity of the Hearts last solvent league game against Aberdeen. If Hearts had beaten the Dons they would of had a extra piont deduction this season. Surely this played on someone’s mind as the Hearts team bus travelled up the M90/A90. Never has a game been played in Scotland with such a benefit for a team not to win. The hangover from the tail end of last season could haunt Hearts for years to come. At a minimum a new charge from the Beeks could be winging its way from Hampden.

Last season a points deduction due to administration would of deducted Hearts 18 points and consigned them to go down. Relegation one division is nothing compared to relegation of FOUR into a league that is in its first year with no track record media deal or sponsor. I can’t see a Hearts deal to parachute them into spfl4 like Rangers were last year going down well with the newly empowered teams of the Highland and Lowland Leagues.
Regardless of what lower league Broken Hearts play in, it will not entice any tv companies to screen their games. Their will not be a clamour to buy Hearts games. Sponsors will simply not care that Hearts have appeared in a lower division. There is little or no added value to them. Certainly not to the value of last year when Rangers fans freindly, income generating invasion of small towns last year. That’s solely due to a lack of numbers of Hearts fan base.

The fate of Hearts remains in the balance. Make no mistake the abyss awaits. Edinburgh could even become a one club city. Hibs could become the only representative in the league from our nation’s capital. Twenty-five years ago Edinburgh had three clubs in league football. Medowbank moved to Livingston, Livingston themselves went onto administration and now ply their trade in lower divisions. Hibs are in a group of tight rope walking clubs, one missed payment away from Administration.

One Club in Edinburgh? There is a real prospect of no football in Edinburgh? A laughable prospect? Well scoot back a year, Hearts fans laughed! Sadly now I fear Gorgie Road will be filled with tears.

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Hearts and The Shysters Charter

21 Jun

Brian Jackson, Neil Patey this close seasons big signings in Scottish Football.  To be fair both have been around a while.  Experienced with proven track record an asset to anyone who requires their skills.  The shame is Brian and Neil are not players they are football finance experts and in a world of internet forums every fan in Scotland is fast becoming competent with the ins and outs of football finance.

I watch with horror as another club looks likely to be liquidated.  Not placed into administration, liquidated.  Every piece of information I have seems to point to the fact Hearts will be liquidated before new season kicks off.  Reasons are simple debts out multiply annual income by over 3.5 times. Three and a half is around the maximum ratio.

Back in the old days when Bank Managers were respected and a mortgage meant a few meetings with this man not a quick hassle free phone call. Banks operated a simple lending plan.  For Joe Public it was simple three times your annual earnings oh and at least a 5% deposit. How we wish in this day and age that this simple financial certainty was still upheld.  Maybe just maybe we wouldn’t have so many state owned banks in 2013 if this was still the way things were done.

The banks with years of careful experience did not just come up with the three multiplied as it was their favourite number.  The banks after decades of experience realised that three was the magic number to lend out savers hard earned cash.

This brings us back to Hearts indeed any football club in Scotland with debt.  What the hell were the banks thinking dishing out increased loans to clubs that would do well to service the interest on the original loan let alone a new increased topped up loan.  A mortgage needed guarantees, collateral to give it its proper name.  A home owner technically does not fully own their home until the mortgage loan is paid off.  So what was put up as guarantee by clubs.

Last year Rangers via what is increasingly seen to be a move by a con man managed to pay off the bank.  The bank happened to have a man on the board and some would suggest in the dash for its cash the bank didn’t care who Rangers were sold too as long as they got paid in full.  Lloyds TSB/HBOS got paid in full and didn’t bat an eye when Craig Whyte then worked his spell over Rangers.  They had there money who cared about due diligence. It seems increasingly obvious that a combination of Craig Whyte and Her Majesties Revenue & Customs pursuit of a failed £100,000,000 claim consigned Rangers ultimately to Division 3.  When the magical EBTs were mainly declared legal HMRC did not say whoops we caused a company to fail via frozen accounts, refusal to compromise and vindictive persecution, no HMRC still convinced its right kept the accounts frozen and appealed the decision.

Hearts though have no powerful other in the picture.  Hearts fans have only one or a series of ones to blame for their predicament.  From the moment Wallace Mercer Sold Hearts the writing was on the wall.  Smart businessmen ignored the good business sense that had made them rich and followed the ideals of the fans.  More, More, More and when you have done that lets have some More. Investment not in reducing the debt, paying it off but servicing the debt.  In credit card terms paying the interest only.  The loans don’t appear to of had a structured repayment plan.  The checks and balances on these loans failed – missed payments tacked on to the loan.  That seems to of been en vogue.  Ambition may bite the nails of success but in this case it destroyed the heart and soul of a club.

Bill McMurdo blogged (http://billmcmurdo.wordpress.com/2013/06/21/way-down-upon-the-swanee-river/) that it appears that Hearts are only the first of a select band of clubs who are destined to call on Brian Jackson and his colleagues.  Bill mentions that unfashionable clubs who have sucked up the pain both publically and privately to ensure that their club runs within its means. Clubs that have put up with beatings and defeats from players opposing teams couldn’t afford are now in pole position to challenge.  As the sneering contemptuous masses of Clubs like Hearts who  looked down on Clubs running good businesses will now find out.  The so called Diddy’s are coming.

Hearts, Aberdeen, Dundee United, Hibs, St Johnstone, Inverness CT and Motherwell all indebted, all looking down from Ivory towers some may be saying there but for the grace of god but all dreading the call from the bank.  All failing to hit the debt being three times income ratio. In these times of reduced media and sponsorship, stands being partially closed due to lack of sales this income is falling as,fast as the interest is being added onto the loans. The lenders are in a panic. The lenders are fed up with multi-million pound liabilities sitting on their books. From a distance and upon forensic inspection these clubs business models don’t add up. The banks are not far from placing a member on the boards of these clubs and a demanding lender approving, disapproving and being in any control of your club is a bad thing indeed(ask a Rangers Fan). Simply put the lenders want out.
The Hearts situation has ramifications for all clubs with debt if a CVA is offered by BDO and the banks think that so many pence in the pound is a good deal they will engineer administration at other clubs to get something back from loans.  Cut losses and run! The flip side if the CVA being created offers in Banks eyes a low pence in pound value, the banks will be battering on the door of chairmen demanding repayment of the loans starting now.  Not cut losses and run more a structured repayment plan that will at best cost each club a players wages a year maybe more. That’s a player not at a club. That’s the double edged sword for most  top division teams.  Not for them cutting their cloth to suit but cutting their throats to pay and pay quickly one way or another.

They are clubs in SPL perfectly well run within means and budgets.  Clubs that have suffered for years destined to finish near the bottom but seen to be happy to be at the party.  Well breaking news they weren’t just at the party they were biding their time waiting for the perfect storm. Who is laughing now.

Sympathy for Hearts is in short supply they bet the farm and lost.  Sympathy should be given however to the countless redundancies being made.  Not the players released because with best will in world players tend to actually profit from being released one way or an other.  no sympathy for the people who today do not have a job and have bills to pay.  The people who worked in offices, answered phones and cleaned to building.  Today jobless going down the job centre after giving years to a reckless club.  Sympathy yeah I am for them.  I wonder if they believed the story given to SPL/SFA at end of last season that Hearts were ok didn’t need Lithuanians.  I wonder if some even bought luxuries thinking this story must be true because the authorities say it is.

The checking facts, Finances, Fit & Proper person investigation department at the SPL/SFA is I am told a room with two rubber stamps sitting on a table. One of the stamps says approved and  the other is a copy in case the first one breaks. That really is the question though.  Who in Authority is carrying out these checks on accounts and is a person fit and proper to run or be on the board of a football club.  Brookes Milestone (Gretna), Craig Whyte (Rangers), Gavin Masterton (Dunfermline) and Vladimir Romanov ( Hearts) all taking over clubs in last decade all the clubs dropped into the smelly stuff.  ALL APPROVED BY THE AUTHORITIES.  Same authorities who approved Stewart Reagan as chief of SFA.

You reap what you sow its true Karma is a bitch all the clichés are coming thick and fast.  As fast it would seem as Heart of Midlothian Football Club falls from top league to given the new structure the Lowland League.  As all Scottish fans should maybe get out of the habit of rejoicing and think who is next.  The Shysters Charter that is Scottish Football is entering the end game.

With the real possibility of two clubs either disappearing from football or relocating in a lower league this weeks fixture lists look more like a fantasy league than a declaration of events.