The Football Association’s proposed £600m sale of Wembley stadium to Shahid Khan has been unexpectedly cancelled after the owner of Fulham football club and the Jacksonville Jaguars NFL team suddenly withdrew.

Khan’s decision to scrap the offer, which the FA first made public in April and on which it has since been consulting, came a week before the FA’s 127-member council was due to vote on the proposal. Greg Clarke, the FA chairman, and chief executive Martin Glenn have consistently argued for the sale, to release the £600m and further matched funding to improve grassroots, public football facilities throughout England which are generally run-down and suffering from local authority budget cuts.

The FA board effectively approved the sale and sought a “significant majority” of support from council members, who represent all sections of football from amateur counties to professional, Premier League representatives.

At a non-voting council meeting last week, where some insiders said the overall sentiment was broadly supportive, some members voiced strong opposition in principle to selling the national football stadium. The former Premier League chairman Sir David Richards, a non-voting council vice‑president who called the proposal “scandalous” in April, is understood to have been one of those who voiced opposition.

That division was cited by Khan as his key reason for withdrawing the offer, which the FA announced first, explaining in a statement that Wembley will now not be sold and will continue to be owned by the governing body: “Mr Khan believed that his offer to buy Wembley stadium would release funds to help improve community football facilities in England and that it would be well received by all football stakeholders.

“At a recent meeting with Mr Khan he expressed to us that, without stronger support from within the game, his offer is being seen as more divisive than it was anticipated to be and has decided to withdraw his proposal.”

Quick Guide What next for Wembley? Show Is Wembley still for sale? - Officially, no. The FA have always said that the offer from Shad Khan to buy the stadium was unsolicited. Unofficially, executives were clearly interested in the opportunity to release substantial funds for investment. But the split between the suits and the blazers, FA Council representatives, was irreconcilable. Even if it were possible to change that in future, potential buyers will no doubt have taken note and will be wary of getting their fingers burnt as Khan has. What about the grassroots investment? - This affair has been another blow to the FA’s reputation, but the biggest blow of all has been to grassroots sport. Khan’s bid included a cash component of £600m, the entirety of which the FA had pledged to spend on a roster of new all-weather pitches across the country, part of a total package they expected to rise to over £1bn. This will now no longer happen, at least not immediately. The FA will continue to own Wembley and the revenues it generates, but these come in over a longer time period and there are debts to take care of too. And those debts? - The FA announced earlier this year that it expected to have paid off the £757m it took to redevelop Wembley Stadium by the end of 2024. The 90,000 capacity venue opened in 2007 and debt repayments initially led to accusations that the showpiece venue was being milked for all the cash it could provide. That is no longer necessary, but the FA may have to look again at its long term revenues if it hopes to deliver anything like the ‘transformative’ change it had hoped for from the Wembley sale. Will this stall any NFL emigration? - Shad Khan did not reveal quite what he intended to use Wembley for, but American Football was certainly expected to be part of it. Khan owns the Jacksonville Jaguars and one approach would have seen him move the franchise to London, creating the league’s first European team. That will no longer happen and one man who will be happy about that is Daniel Levy. The Spurs chairman sees the NFL as central to plans for his own new stadium, currently facing difficulties after its opening was delayed. There will now be at least two venues competing for American sports teams, but no single franchise. Photograph: Tottenham Hotspur FC

Since 2013 Khan’s Jacksonville Jaguars NFL team have played one match a season at Wembley, which have been popular and lucrative for the team. The motivation for his proposed purchase was widely assumed to be a move to extend the NFL and Jaguars’ London presence in future years. Last week Mark Waller, an NFL executive vice-president, said London could host a permanent NFL team from 2022. Khan’s representatives have denied that this is explicitly the plan for the Jaguars, explaining that the extension of the profitable London presence, which further markets the sport outside the US, will have to be decided by the NFL as a whole.

Khan also cited the divisions within the FA council in his statement, saying: “At this moment, following last week’s FA council hearing, it appears there is no definitive mandate to sell Wembley and my current proposal, subsequently, would earn the backing of only a slim majority of the FA Council, well short of the conclusive margin that the FA chairman has required.

“Unfortunately, given where we are today, I’ve concluded that the outcome of a vote next week would be far from sufficient in expressing the broad support favored [sic] by the FA chairman to sell Wembley. Until a time when it is evident there is an unmistakable directive from the FA to explore and close a sale, I am respectfully withdrawing my offer to purchase Wembley Stadium.”

The FA said the Wembley debate has “undoubtedly raised awareness of the issue that community football facilities in England need significant investment”. Attention will now turn to that issue, and in particular whether the Premier League, whose 20 clubs are receiving £8.4bn from the 2016-19 TV deals, should contribute more to fund grassroots improvements.