By Echo Wang and Rohith Nair
July 28 (Reuters) - FIFA said on Tuesday it plans to create a $20 billion subsidiary to run the World Cup and its other events and will offer stakes of up to 20% in it to external investors, a move that provoked a furious response from UEFA, who accused world soccer's governing body of putting the game's "soul" up for sale.
Under the plan, FIFA would establish FIFA Forward Enterprise (FFE) to oversee "commercial and event operations."
FIFA, which just held a 48-team World
Cup across the U.S., Canada and Mexico that was the biggest in the tournament's history, would retain control of the enterprise, but offer minority stakes in it to private investors to raise up to $4.2 billion.
A vehicle founded by Joshua Kushner, the brother of Jared Kushner, U.S. President Donald Trump’s son-in-law, is expected to lead the proposed investor group, FIFA said.
The proposal deepens the divide between Switzerland-based FIFA and European soccer's governing body UEFA, with Europe positioning itself as the custodian of the game while FIFA, a not-for-profit organisation, remains focused on broadening access with financial largesse.
FIFA is one of the world's wealthiest sporting organisations, generating billions of dollars in revenue, largely from broadcasting rights, sponsorship and other commercial deals linked to the World Cup.
But it says this proposal can increase funds it provides to widen access to the sport and strengthen global participation, with all net benefits to be reinvested in the game.
"Football is the world's most popular sport and an extraordinary engine of human and social development," FIFA President Gianni Infantino said in a statement.
"Parts of the game have turned that popularity into remarkable commercial value – and we celebrate that success and want it to continue, because it lifts the whole game.
"Our job is to make sure the rest of football grows with it: FIFA exists to support sustainable, inclusive development in every corner of the world."
FIFA said it would retain sole control of the subsidiary as well as "exclusive authority" over football governance, competitions, the match calendar and all regulatory and sporting decisions.
FIERCE CRITICISM FROM UEFA AND OTHERS
The proposal drew fierce criticism from UEFA, which said the proposal "crosses a line that football's governing institutions should never cross."
"UEFA takes it extremely seriously," it said in a statement. "So should every National Football Association. So should every stakeholder: leagues, clubs, players, supporters, governments and everyone who cares about the future of the game.
"The soul and governance of football are not assets to trade — especially with zero transparency as to who gains financially. None of us are the owners of football. It is not FIFA's to sell."
Relations have deteriorated between UEFA and FIFA in recent years, and UEFA President Aleksander Ceferin refused to attend the World Cup final following a series of disagreements over disciplinary procedures, refereeing logistics and match operations.
A FIFA spokesperson said the proposal will soon be presented to the 211 member associations and the FIFA Council, which would be the sole final decision-makers on the matter.
FIFA said money from the capital raise would be used to establish an optional program that would allow member associations to access up to $20 million in one-off capital to be used for infrastructure, coaching, national teams, competitions, grassroots football and the women’s game.
That would rise to $24 million by the 2035-2038 cycle.
Infantino, who is up for reelection as head of FIFA next year, said every member association should have the opportunity to seek a fair share of the available funding to shape its own future.
"This is about the democratisation of football worldwide," he said.
Britain's new Prime Minister Andy Burnham joined critics of the plan, saying on social media that the sport does not belong to investors.
"The World Cup is not a product. It is the greatest competition in world sport, and it was never anyone's to sell," Burnham wrote on X. "Dress the deal up however you like. Once you have sold a piece of it, you have sold out."
Richard Sheehan, a finance professor at the University of Notre Dame who studies the economics of sport, called the proposal a "money grab" from current FIFA leadership.
"From the perspective of a not-for-profit organization, theoretically raising money to make soccer available to everyone, this move is a farce," said Sheehan.
EXTERNAL INVESTORS
FIFA is working with bankers at JPMorgan to bring in external investors, it said, adding that former Liberty Media CEO Greg Maffei has been involved as a commercial adviser.
Joshua Kushner-founded Thrive Eternal, a new investment strategy launched by venture capital firm Thrive Capital, is set to lead the investor group.
A permanent capital vehicle focused on making a small number of long-term investments in franchises and cultural institutions, Thrive Eternal took a minority stake in Major League Baseball’s San Francisco Giants this year. Former Walt Disney CEO Bob Iger serves as an adviser.
Jared Kushner is not a potential investor, a source said.
JP Morgan and Joshua Kushner declined to comment. Maffei didn't immediately respond to a comment request.
"Outside investors will have only a minority stake in FFE and will not play any operational role," FIFA said. "Equally, they are investing in a subsidiary of FIFA, and not in FIFA itself. For FIFA, nothing changes."
(Reporting by Echo Wang, Rohith Nair, Frank Pingue, Tommy Reggiori Wilkes, Sabrina Valle and Dawn Chmielewski; Editing by Ed Osmond and Rosalba O'Brien)
