Robinson looks to sell his 19% stake in Hearts

Robinson yesterday admitted that he is now ready to sell his 19% shareholding in the club for over 2.5m in what may be a bid to exit from Tynecastle and return to the catering industry.

Robinson recently priced his 2.5m shares in the club to potential buyers, who were asked to sign confidentiality agreements. He is understood to be seeking more than 1 per share, valuing his stake at around over 2.5m, which would represent the recovery of his total cash investment in the club. He would perhaps earn a small "profit" in the form of his six-figure pension fund, in addition to a salary of almost1m in his time as chief executive.

At close of trading on the London Stock Exchange on Friday, shares in Hearts plc were trading at 30p each, which means that Robinson is seeking a price for his shares which is more than three times their market value.

"I have made it clear that I am open to offers for my shareholding," said Robinson yesterday, "and I will accept the right offer if it comes along."

That time may be soon. Firm offers may be made shortly, but those individuals involved are sticking to their agreement with Robinson to keep matters confidential. Two shareholders, who requested anonymity, yesterday confirmed that they were made aware of the chief executive’s willingness to sell and the price he has named.

The revelation that moves are afoot for the purchase of Robinson’s shares must place in doubt his continued role as chief executive of Hearts, especially as he and new chairman George Foulkes have started discussions on what Foulkes calls "the dilemma" of a major shareholder also being chief executive. If his shares are bought by anyone other than a close ally, Robinson would find it difficult to resist a boardroom coup against him.

Under Robinson’s stewardship, Hearts’ debts have risen from 5m to nearly 19m. He has also aroused controversy over his plan to sell Tynecastle and move to Murrayfield. An EGM to confirm that move is still to be arranged.

Robinson will also face questions at the meeting over his external role as chairman of a fast-growing catering company. Shareholders from the Heart of Midlothian Supporters Trust will use the EGM to tackle Robinson over his increased involvement with catering company Heritage Portfolio.

Most Hearts’ shareholders and supporters think Robinson’s role as their chief executive is his only pursuit. But Robinson also owns 25% of Heritage Portfolio, of which he is also chairman and company secretary.

Even before then, George Foulkes, who did not know of Robinson’s catering activities until told by Scotland on Sunday, will seek reassurances from his chief executive.

"The Board wishes to ensure that all our employees give 100% to the club," said Foulkes, "and I have no indication or evidence that Chris Robinson has given anything other than that. But in the light of these matters being drawn to my attention I will be asking question with the aim of ensuring that this continues to be the case."

"It will come as a compete shock to supporters to learn that Chris Robinson is chairman and company secretary of another business," said a spokesman for Heart of Midlothian Supporters Trust. "In the midst of the biggest crisis this club has faced in its history, the supporters and shareholders have the right to demand their chief executive’s full attention.

"We expect nothing less than 100% commitment from Craig Levein and his players, so why should the chief executive be any different? As shareholders, we will be asking searching questions at the EGM. I expect the supporters’ calls for Robinson to resign will be redoubled."

Robinson had withdrawn from the catering industry until January, 2002, when he started his own company, Heritage Hospitality, based at Hopetoun House near South Queensferry. It later merged with Portfolio Catering to become Heritage Portfolio. Over the last two years, Heritage Portfolio has become a genuine force in the Scottish catering industry, with a reported turnover of nearly 3m (Hearts’ turnover last year was 5.9m).

Heritage Portfolio has certainly continued to expand, with its Beetroot Blue internet division, which specialises in delivering prepared food to companies around Edinburgh, proving particularly successful.

Robinson has never hidden the fact that he is a major player - he told the Hearts’ board long before Foulkes arrived, and as our picture shows, he took centre stage at the company’s wintertime party at Mansfield Traquair church.

But Robinson has certainly taken on more of a role within the company in the past year. Not only has Robinson been chairman of Heritage Portfolio, but he took on the legally important position of company secretary in June, 2003.

While many chief executives in industry wear other "hats", supporters and shareholders may wish to ask why, with Hearts in the midst of a financial crisis, the chief executive is involved elsewhere at all.

Robinson’s total remuneration from the club over the last seven years totalled 854,000 up until last month, but that does not include earnings by Robinson and his company, Wheatsheaf, from 1991 to 1996 when he held the catering contact for Hearts - the association which brought Robinson into the club at Wallace Mercer’s behest and which earned him his "Pieman" sobriquet.

Those Wheatsheaf sums could not be detailed but were said by a former director of Hearts to be "substantial and in six figures (per year)". Asked about these earnings for Robinson’s company, an official statement from Hearts said they were "not relevant".

If Robinson sells out for 2.5m he will not make much of a profit but will still have his pension fund. Hearts pay into this at the rate of 12,000 per year or more than 74,000 in total, which given normal growth means a policy worth over 100,000.

It is almost ten years since Robinson and his former associate, Edinburgh lawyer Leslie Deans, took control of Tynecastle from Mercer after they set up a company called New Hearts Ltd to acquire just over 50% of Hearts FC for 2.1m. In June, 1994, the duo paid 1.2m up front and then paid Mercer the balance over six years, while Robinson has invested 1m at other times such as the 1997 stock market flotation.

New Hearts Ltd remains the vehicle through which Deans and Robinson own their shares in Hearts plc and though the two men have long since fallen out spectacularly, they still own 50% of New Hearts each - they are named as joint directors in company documents.

"It’s like a couple who are divorced and living in the same house," said Deans. "We don’t talk but we do jointly own the company."

Evidence has emerged that after New Hearts Ltd took over at Tynecastle, one of the club’s directors was deliberately excluded from discussions about matters to do with Hearts. Colin Wilson, 69, has spoken out for the first time about the "great difficulties" he faced, detailing the remarkable behind-the-scenes behaviour of other directors during the 1990s, when they refused to give him access to financial details about the club of which he was a director because he was associated with former owner Mercer.

"At the time I was representing Wallace Mercer’s remaining 25% shareholding," said Wilson. "Just about everybody that had anything to do with the Mercer era was fired. But they couldn’t fire me. They obviously knew that I was representing Wallace and would be reporting back any relevant information.

"We used to have board meetings [of Hearts FC] and then they would say ‘that's it Colin, goodnight’. Then they’d have a New Hearts board meeting and everybody still sat there while I had to leave. It was virtually a Hearts’ board meeting with me excluded - it was a tough time, but Robinson used to say to me: ‘it goes with the territory of being a Mercer man’.

"Yes, I was working in his interests but directors of companies must work in the interests of all shareholders. I had great difficulties in getting information. At one AGM I had to tell shareholders that I had been forced to go to law to get access to the financial figures. It is a matter of record that I had to send lawyer’s letters before I could get access to some of the financial information. Once the law kicked in, they were a bit more open with me."

Wilson soon gained the respect even of anti-Mercer directors, and he was asked to stay on the board when Hearts became a plc in 1997, a flotation which raised 5m to complete the rebuilding of Tynecastle.

"I wasn’t just a Mercer man," said Wilson. "I was a responsible professional, non-executive director of the football club. I’d been a director of eight companies. I was the man who invented the 500 club, which, together with the Football Trust, paid for the first stand that was built in Wallace Mercer’s time. I brought in Strongbow as sponsors and, incidentally, I found Andy Kirk in Northern Ireland when I was over there on business with Shell - I saw him in a match, told Jim Jefferies and he flew over there and bought him."

Moving from Tynecastle "was never mentioned, mooted or even considered in board meetings," said Wilson. "We had got over the era of Wallace’s idea of moving to Millerhill, and that’s why we built the new stands.

"Personally I didn’t want to go down in history as one of the men who sold the Hearts’ family silver. We looked on Tynecastle as our major asset."

Following his retirement, Wilson now lives in Spain but follows the fluctuating fortunes of the club he has supported all his life. "I’d hate to see anything damage the club in any way," he said. "I am a fan and I look at what is happening today with considerable concern."

The present board is struggling to balance the books and there remains doubt as to where Hearts will be playing next season. But the position of the chief executive is more likely to occupy their minds in the near future.

Foulkes said he was unaware of any activity regarding Robinson’s shares but said he knew of potential buyers.

"Over the past few weeks I have been made aware of a number of groups and individuals who are keen to buy shares," said Foulkes. "I would hope that if anyone’s shares are for sale they would be made available to these potential buyers."

The chairman confirmed that he and the chief executive were reviewing the issue of Robinson’s dual role as a major shareholder who effectively employs himself. "We have had discussions about the implications for corporate governance of this dual role," said Foulkes, "and we both agree that there are problems.

"I understand that he has some intention of taking action over the dilemma arising from that dual role, but we have not discussed this in any detail or in any timescale."

It is no secret in the Hearts’ boardroom that the demonstrations against Robinson by the supporters have had their effect on the chief executive and his family. No-one would deny that Robinson has fought a good fight by his lights, but perhaps the final bell could soon be tolling for this controversial figure.