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THE threat of liquidation hangs over Hearts as UKIO Bankas, the club's main creditors, have knocked back the latest takeover bids.

An exclusive statement given to the Daily Record at around 11am this morning revealed that the bank will soon "remain with the only solution – liquidation of Hearts of Midlothian Plc. and enforcement of the standard security over Tynecastle stadium", unless improved offers for the club are not forthcoming.

The news will cause panic, not only at the club, but among the ranks of the new Scottish Professional Football League - with the start of the new season just days away.

Beginning "offers from investors to Hearts FC are not satisfactory to Ukio bankas" and adding that: "Hearts FC administrators are obliged to continue negotiations with two potential investors", the statement continues:

"Ukio bankas – the main creditor of Scotland’s football club Hearts - obligated the club’s administrator BDO to continue negotiations with two potential investors with the aim to improve financial offers. If the negotiations fail, Ukio Bankas will initiate the process of liquidation of the football club.

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“I can repeat that we are doing everything we can to save the club functioning," added Gintaras Adomonis, Ukio bankas bankruptcy administrator. "However, I am obliged to protect solely the interests of Ukio bankas and its creditors.

"If no feasible offer with terms and conditions acceptable to Ukio bankas creditors is achieved, Ukio bankas will remain with the only solution – liquidation of Hearts of Midlothian Plc. and enforcement of the standard security over Tynecastle stadium.

"I sincerely hope this is the way of things we still can avoid."

Ukio Bankas holds a 29.9 per cent shareholding in Hearts and has a floating charge on Tynecastle as security against the money it is owed.

Meanwhile, Kaunas-based investment firm UBIG is owed a further £10million by the club. It owns a 50 per cent stake.

Both companies were once controlled by former Hearts owner Vladimir Romanov but are now insolvent. Ukio Bankas is in the hands of administrators while the process of appointing trouble-shooters to oversee the liquidation of UBIG was launched last week.

(Image: SNS)

Ian Murray MP, independent chair of the Foundation of Hearts, said: "Our bid team, working on behalf of the Foundation of Hearts continues to negotiate on the points of the bid submitted on our behalf to BDO.

"Meetings are scheduled for this week, and have been since our revised bid and proof of funding was submitted last Wednesday, as requested. It's very much business as usual.

"We remain hopeful that we can demonstrate to the club's creditors that our proposal provides the strongest return and carries the lowest risk, in short by far the best solution.

"This announcement from Lithuania does again, however, demonstrate the need for supporters to set up direct debits via foundationofhearts.org, if they can do so."

BDO's Bryan Jackson, joint administrator of Hearts, said: "We are continuing to work with the administrator of Ukio Bankas and the bidders to enable the club to exit administration as a going concern.

"However, it should not be forgotten that it is the duty of the administrator of Ukio Bankas to achieve the best financial result for the bank's creditors and he will act to ensure that this happens.

"Liquidation is always a possibility when a business is in administration, but we are confident that we can work with the bidders to produce an outcome that saves the club and provides an acceptable return to the creditors of Ukio Bankas.

"I believe that we are making progress towards a constructive solution and hopefully all parties will recognise that the best value will be realised by selling the club as a going concern."