The proposed colour change of Melbourne Heart from red and white stripes to an all-sky blue kit has fallen through after an objection by Sydney FC was upheld by FFA and an independent arbitrator.



Heart's proposed change was one of the first points of order for their new owners, English Premier League club Manchester City, who are determined to create a global network of clubs with a similar colour scheme.



After the club's Abu Dhabi-based owners bought Manchester City in 2008, they have recently embarked on aggressive expansion, creating New York City from scratch, taking an 80 per cent stake in Heart and, earlier this month, buying 20 per cent of Japanese side Yokohama F. Marinos.



However, while it is still expected the club's name will change from Melbourne Heart to Melbourne City in time for next season, they will – for the moment, at least – continue playing their home matches in red and white stripes.



"While the introduction of Manchester City into the A-League is a fantastic opportunity, we made the decision having regard to the fact that we are only a 10-team competition with young brands in a highly competitive environment," said FFA head of A-League Damien de Bohun. "Approving the change would have meant two teams with home shirts of an almost identical colour. We will consider any proposals put forward in the interests of achieving the right balance."



A grievance hearing took place at FFA headquarters in Sydney last week between Melbourne Heart and FFA, the result of an earlier decision by FFA chief executive David Gallop to reject Heart's request to change colours.



Gallop had originally told Heart's representatives that he agreed with Sydney FC's determination to keep the sky blue colour solely aligned with the two-time champions.



Sources said the hearing was "very spirited" and that there was a "serious tension developing between Heart and the FFA", with the Heart hiring senior counsel Garry Hatcher to act on their behalf.



It is understood Heart's owners believe they are providing the A-League with a significant philanthropic boost and deserve the ultimate say in how they run the club.



However, the decision from the independent arbitrator, Shaun McCarthy, was handed down on Tuesday and ruled in favour of the governing body. Sydney FC chairman Scott Barlow said his club felt the right decision was made.



"We support the FFA's decision not to approve Melbourne Heart's proposal to wear a sky blue home strip," Barlow said. "We also support the decision handed down yesterday by the independent arbitrator to uphold the FFA's decision.

"The A-League is a young competition with only 10 teams and the idea of two teams wearing sky blue and embracing a sky blue identity is not in the interests of the league. This is a very good decision for Sydney FC and the A-League as a whole."



However, a statement from Melbourne Heart on Wednesday indicated the matter was not necessarily settled.



"The club remains in constructive discussions with the FFA on a range of matters relating to its future plans including its playing strips," it read. "On the matter of colours, as we have said previously, any decisions made in relation to the club's identity will be guided by the traditions of our existing fan base, including their passion for red and white, and the opportunities provided by our new ownership."



It is plausible that Heart’s ownership conglomerate could now take the matter to the Supreme Court, although they may risk further alienating their fans, many of whom have argued fervently in favour of keeping the club's existing colour scheme.



In other news, Perth Glory have announced the signing of Newcastle Jets captain Ruben Zadkovich on a three-year deal and are soon expected to announce the arrival of Ireland international striker Andy Keogh.



Elsewhere, Central Coast Mariners striker Adam Kwasnik has retired after a prolonged battle with injury and will take a community coaching role with the club.