HEARTS took a further step towards exiting administration yesterday when their parent company, Ubig, finally entered insolvency.
The Lithuanian Court of Appeals, which had postponed the case several times, appointed UAB Bankroto Administrativo Paslaugos (Bankruptcy Administration Services) as Ubig’s administrators.
The move frees Ubig, under its administrators, to take an active part in talks, scheduled for later this month, which aim to agree a Company Voluntary Arrangement. Should those talks be successful there would then be a 30-day cooling-off period before any agreement became final.
Bryan Jackson of Hearts administrators BDO explained that two meetings would take place in the coming weeks. “To ensure we have sufficient time to liaise with the new administrators of Ubig we shall now be presenting the CVA to members (ie shareholders) on 29 November and retain the meeting of creditors on the 22nd,” he said.
Ian Murray MP, chairman of preferred bidders the Foundation of Hearts, said: “It’s another step forward in the process towards giving Hearts a new start,” he said. “We are hopeful that things will continue to progress ahead of next Friday’s meeting.”
Ubig owns 50 per cent of the shares in Hearts and is owed around £9 million. But because it is an unsecured creditor, it would get nothing either from a CVA or from attempting to force a sale of Tynecastle.
Ukio Bankas, which like Ubig was controlled by Vladimir Romanov, has a smaller shareholding of just under 30 per cent and is owed £15m. Crucially, it is a secured creditor, meaning it would need to get all its money back before any unsecured creditor got a penny – although under the terms of the CVA proposed by BDO, it would get around £2.5m. Companies controlling at least 75 per cent of the debt have to agree to a CVA before it is passed.