FIFA confirms that it plans to create a subsidiary to sell its commercial rights

FIFA announced this Tuesday that it plans to expand funding for football development to more than $10 billion – €8.78 billion – through FIFA Forward Enterprise (FFE), a new subsidiary owned and controlled by the world football governing body and which will open the door to private investors.

“FIFA is exploring the possibility of integrating FIFA commercial rights – covering broadcasting, sponsorship, ticket sales and licensing – with the operational management of FIFA tournaments through the creation of FIFA Forward Enterprise. A consultation process has been launched following receipt of a proposal that seeks to maximize the potential of FIFA broadcast rights and sponsorships across all its men’s, women’s and youth football tournaments,” FIFA said.

In addition, he explained that if the company is created, a decision that must be approved by the member federations, it would maintain its exclusive control and “exclusive authority over the governance of football, competitions, the match calendar and all regulatory and sporting decisions.”

This Tuesday, The Times published that FIFA, sponsored by the American banking entity JP Morgan, was going to create a company to manage and sell participations in the World Cup and that the governing body of world football would be the majority shareholder, with a privatization of between 20 and 30% of the capital of the tournaments. UEFA cried out against this decision, ensuring that no one “owns football” and that therefore it is not legal to “trade” with it.

“Football is the most popular sport in the world and an extraordinary driver of human and social development. Some aspects of football have transformed its popularity into notable commercial value, and we celebrate that success and hope it continues, because it drives all of sport. Our job is to ensure that the rest of football grows in tandem: FIFA exists to support sustainable and inclusive development in every corner of the world,” said FIFA President Gianni Infantino.

Thus, he argued that each member federation should “have the opportunity to access a fair share of the available funding to shape its own future, deciding for itself rather than depending on others.” “This is about the democratization of football globally. We intend to invest heavily in even the smallest or most remote regions of the football world, places that are too often overlooked. Each FIFA member association, regardless of its size, resources or geographical location, will have a voice and the opportunity to determine its own course. Football has become a truly global sport, so its benefits must be felt around the world,” he noted.

According to FIFA, if the initiative is approved, each of the member associations would have an optional 20 million dollars – 17 million euros – in exceptional and immediate financing for special projects of the new FIFA Fast Forward Program (FFFP); 20 million in Forward financing for the period 2027-2030 -currently budgeted eight million dollars-; 22 million for the period 2031-2034; and 24 million for the period 2035-2038.

“FFE would raise up to $4.2 billion later this year to fund FFFP, based on an initial equity valuation of $20 billion, through the careful selection of long-term investors who will acquire non-controlling minority stakes in FFE. All net profits from FFE will be reinvested in football globally,” FIFA explained.

In addition, he confirmed that JP Morgan has been hired to work hand in hand with the organization, while other advisors, such as OpenEconomics, are “in contact with potential long-term investors.” “The process is focused on assembling a geographically diversified group of investors that reflects the global nature of FIFA and the sport; expressions of interest received to date include investors from all major regions of the world: Europe, America, Asia and Africa,” he said.