Tony Bloom invests £10m in Hearts

Those that say you can't disrupt the power balance in Scottish football with just £10m may be missing the point

“How can we seriously aim to challenge for league title? The biggest club in the league has 6 times the revenue and nearly 4 times the average attendance. It’s impossible. Isn’t it?”

The numbers match, but that’s not Hearts and Celtic I’m talking about. That’s the situation Union Saint-Gilloise (USG) found themselves in Belgium in their first season back in the top flight after 48 years, following investment from Tony Bloom. They aimed to win the Belgian title, despite the biggest club that stood in their way - Club Brugge - having a massive financial advantage and vastly superior fanbase size. Four years later and USG currently sit 1 point clear of Brugge at the top of the table with 3 games left to play.

Grab a cup of coffee and join me for a long read, deep dive in to Tony Bloom’s investment into HMFC. I’ll go into detail on a number of topics, with the sections titled as follows at:
the shares, the foundation, the lizard, the analytics, the disrupter, the finance & the philosophy

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THE SHARES

Brighton owner and Chairman Tony Bloom is on the verge of acquiring a 29% stake in Heart of Midlothian for £9.86m. This values the club at £34.03m. As a comparison, last year Hibernian sold 25% of their company to the “Black Knights” (headed up by Bournemouth owner Bill Foley) for £6m - valuing the Hibees at £24m. An impending takeover of ~51% of Rangers by the San Francisco 49ers enterprises would value the Ibrox club at anywhere from £100-£200m, but details on that acquisition have not yet been released to the public.

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THE FOUNDATION

The Foundation of Hearts (FoH) are the current club owners, and so at least 50% of their 8,000+ members will have to approve Bloom’s investment for it to go through. The FoH are advising the members to accept this investment as they see it as an "unprecedented opportunity for the club". Failing any unexpected paperwork hitches or red tape, the move should be completed following an EGM within the next month. The deal will be meticulously structured to ensure Bloom doesn’t fall foul of any multi club ownership (MCO) rules. Two years ago, Bloom had to reduce his stake in USG to 25% when both they and his main club, Brighton, qualified for Europe in the same season. This MCO restriction reportedly also lead to UEFA banning Brighton from signing highly rated striker Victor Boniface from USG, before he was eventually sold to Bayer Leverkusen.

Bloom’s 29% would be for ‘non-voting’ ordinary shares and so FoH would retain 75.1% of the voting rights. As part of the investment he will appoint someone on his behalf to sit on the board as a director, and have a key role in the running of the club. The distinction here being that the FoH retains voting ownership - so that they can safeguard the future of the club. For example, external investors couldn’t push through a sale of Tynecastle Park or the changing of the club colours from Maroon to Green - because the FoH wouldn’t vote for it. The FoH won’t however decide which players should be signed in a transfer window or if the manager should be sacked.
Hearts are fan owned, not fan run.
And it’s an impressive model - in 2021 Hearts officially became the largest fan-owned club in the United Kingdom.

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THE LIZARD