Hearts administration: ‘Fan group can save club’

Mackie insists organisation has resources and principles to rescue Hearts from abyss. Picture: Ian Georgeson
Mackie insists organisation has resources and principles to rescue Hearts from abyss. Picture: Ian Georgeson
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ALEX Mackie, one of the founder members of the Foundation of Hearts organisation hoping to take control of the stricken Tynecastle club, has claimed they offer the only viable means of its long-term survival.

As Hearts prepare to formally enter administration, the Foundation are understood to be facing rival interest in the club from businessmen and consortiums both in the UK and abroad. But Mackie has cast doubt on the wherewithal and intentions of other potential bidders, insisting the Foundation of Hearts possess both the resources and principles needed to rescue the club from the greatest crisis of its 139 year history.

“It’s the main alternative, it’s actually the only show in town which is going to be sustainable for the future,” said Mackie. “The fans will get to choose the people, hopefully local and dedicated people who are Hearts fans, plus business people, to get a chance to see the future. That future is rosy if they grasp that chance. If you get the right people in there and you get the right corporate governance, Hearts are a great club. They have got a great financial base and we should not fail, given the chance.

“We represent the fans and provide an alternative. Hopefully that alternative will prove to be the only alternative. In the long run, we will seek to be the watchful and nurturing parent of the club if we are given our chance. The development of the Foundation has got us into what I believe is now a really strong position. The pledges have gone up rapidly and it will hopefully give us a substantial sum of money to fund the working capital of the club.

“One of the Foundation’s roles is to flush out all these other people who are coming in and saying they will do this, that or the other at the club. They all want something. They want access to the commercial rights or they want to own Tynecastle and lease it back.

“The Foundation want a sustainable model where trusted, talented people will come in and set up the club for the long term. It is selfless. We have yet to see the money [from other parties], this is the point. Let’s see it and let’s check it out. You have to have working capital to sustain a club and that’s why none of them have come in yet. It’s not just the purchase price of the club, it’s about the working capital until you can get into a balanced budget situation.”

Speaking on BBC Scotland’s Sportsound programme last night, Mackie believes the Foundation of Hearts have been vindicated after they had a £450,000 bid for the club turned down by director Sergejus Fedotovas last November.

“We are now in a position to construct a bid towards an administrator,” added East Lothian businessman Mackie. “We don’t need to deal with Sergejus any more. Let’s go back to Christmas when he said the Foundation had no idea how to value a football club. Well, we did. You value the brand, the rights and the assets. The main asset is Tynecastle which is assigned to Ukio Bankas. We are now going to be dealing with an administrator who will want to know there is a sustainable model with money coming in over a period of time to ensure the long term interests of the club are viable. That is what we are striving for. In the week of the share issue, we were in valuing Tynecastle. The actual value we got was £5.5 million for the stadium. That’s the value of the asset but folks can’t get too bogged down in that. The value of a company is something different, when you have to take into account a whole load of other things including the debt, the working capital and potential revenue stream.

“The budgetary control is straightforward. We have to learn from the mistakes of the past. You set your budget and have budget holders which, at Hearts, should be the team manager and the chief executive. Make sure the budget has certain performance targets included.”

Paul Goodwin, head of Supporters Direct who are backing the Foundation of Hearts’ bid, remains confident fan ownership can prove to be a successful model at the club. “I don’t see any reason why not,” said Goodwin. “At the end of the day, they are super-loyal customers who will always be there. White knights come and go. Hearts will be the 154th club to go into administration in the UK since 2000 – only two of those clubs have been under fan ownership when they have gone into administration. The vast majority have been run by the white knights. We are at the early stages of fan ownership in Scotland. There are lots of things which need to be teased out and a lot of education to put in. Part of that is to educate the wider fans about paying what you can afford, not shooting for the stars. You can’t be something you are not, we have seen that in recent years with Gretna.”