Hearts plan to extend borrowing to £40m

HEARTS shareholders will be asked to approve a doubling of the board's borrowing powers - from £20 million to £40 million - at the club's forthcoming annual general meeting.

The motion at the agm at the end of the month is sure to be passed, as Vladimir Romanov owns more than 80 per cent of the shares.
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This week Hearts announced a total debt for the year ending 31 July last of £28.4 million. The figure is greater than the maximum permitted to the directors, as not all of the debt is classified as coming under their borrowing powers.

The club does not necessarily intend to increase its debt by a further £20 million, but wants the freedom of movement to pay for ground redevelopment among other things over the coming years. The purchase of the requisite land will cost almost £6 million on its own, while the building of a new main stand - the first phase in the planned rebuilding of Tynecastle - could take the increased spending towards the £20 million mark.

Romanov has planned to redevelop the ground since before he bought into Hearts, and there is likely to be little, if any, resistance to the motion at the agm, even from shareholders who may be worried by certain aspects of his administration.

"It is necessary to get the ground redevelopment under way," said Derek Watson, of the Hearts Supporters Trust. "They can't do it without money. To make progress they're going to need to increase their borrowing."

The motion simply calls for the relevant Article of Association of the club to be "amended by deleting the reference to £20 million and substituting £40 million". The agm will be held on Tuesday, 27 February, at 11am.

Taken from the Scotsman