Local firms behind Hearts bid
Foundation of Hearts chairman Ian Murray has described the "Dragons' Den scenario" of Edinburgh business people providing the initial capital for a fans' takeover as a "win-win situation" for the club.
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The group, which was named as preferred bidder by administrators last week, has unveiled its model to purchase the club via private individuals who are paid back gradually by fan contributions.
More than 6,700 supporters have set up direct debits from £10 to £500 a month, the first instalment of which will be collected on September 2, in order to attain ownership of the Scottish Premiership club.
The initial purchase will be made by a 'special purpose vehicle' called Bidco which will sell the club to a partner named Fanco over a predicted three-to-five-year period.
But, unlike professional investors Duncan Bannatyne and Theo Paphitis in BBC programme Dragons' Den, the Foundation has stressed that its backers will not gain financially from the deal.
It is understood they will be repaid at an interest rate akin to one attached to a standard bank account.
And Murray argued it would be a much more preferable scenario than other options including buying the club via a commercial loan or through a deal where fans rent the stadium from a landlord.
The Labour MP for Edinburgh South said: "Bidco are all Hearts supporters who are from Edinburgh. They are incredibly experienced business people and they are doing this for absolutely no personal gain whatsoever.
"They bring a great deal of experience so actually it's almost like a Dragons' Den scenario whereby not only do they put up the capital to try to deliver the CVA (Company Voluntary Arrangement), which would be paid back from the fans over a period of time, but they bring expertise as well.
"So not only do we have the professionals in this football club but the opportunity to bring in some very successful people and we have the partnership with the fans.
"It's a win-win situation all round and it means delivering the financial stability and bright future for this club is easier.
"It's the best for the club. It keeps the assets, the stadium and the football club together and it keeps a partnership between the capital and the revenue."
The Bidco backers do not want to be named before a CVA is secured. And the extent of the immediate fan influence is still to be determined.
"These things have to be worked out but Bidco cannot sell the club to anyone else but Fanco," Murray said.
"That will be a legal agreement and that legal agreement will also contain an immediate influence for Fanco on the Heart of Midlothian Football Club board.
"So there's a real possibility for a very strong partnership that keeps all the assets and the football club together along with the supporters' involvement."
The success of a CVA is in the hands of the administrator of Lithuanian-based Ukio Bankas, which holds the security on Tynecastle on the £15million it is owed, which is about half of the club's total debt.
It is understood the Foundation's initial bid was £3million to go towards a CVA, but the bank could spark a sale of the stadium and the liquidation of the club if it is not satisfied with that amount.
The situation is further clouded by the fact that major shareholder UBIG, which is owed more than £8million but is an unsecured creditor, is at an earlier stage of a similar insolvency procedure.
However, Murray said: "The Ukio Bankas administrators would have had to be persuaded to allow the preferred bidder status to be granted so in that sense we are very confident we are able to deliver something.
"They have given us the authority to be able to try to deliver the CVA so in that sense it's an incredibly positive step forward.
"There are still imponderables around the UBIG shareholding because their legal entity is still to be determined through the courts.
"But BDO are working very, very hard in all of that and we are able to work hand in hand with them now having been given the preferred bidder status."
Joint-administrator Trevor Birch of BDO stressed that more work was needed to complete the purchase.
Birch said: "It has been a great achievement by staff, players, management and fans to enable the club get to this stage.
"However, there is still some way to go and we will work with FOH to ensure that the bid produces an acceptable CVA for the creditors.
"At the moment we cannot put a timescale on the process as a number of negotiations with various parties still need to take place and we are waiting for the appointment of administrators to UBIG to be ratified.
"However, we can ensure that collectively we make as much progress as possible on our side so we are able to finalise the matter quickly once the opportunity presents itself."