Real Madrid have appointed Italian Carlo Ancelotti as their new coach on a three-year contract, the Spanish club said on Tuesday.
The former Paris St Germain manager will be presented on Wednesday and will replace Jose Mourinho who left at the end of last season to join Chelsea.
"Familiar with the pressures of managing the great teams of the continent (Juventus, AC Milan, Chelsea and PSG) the Italian is a guarantee to direct an exciting project," Real said on their website.
Ancelotti, 54, has been linked with the post since Mourinho's departure and had asked to leave PSG but the deal was reportedly held up until the French champions found a replacement.
PSG announced they had agreed a two-year deal with former France coach Laurent Blanc at the same time as Real made public their agreement with Ancelotti.
Spanish media have reported that Real will pay PSG around four million euros in compensation for the year's contract he still had left with the French club.
Real president Florentino Perez's choice of Ancelotti is seen as a move for a less confrontational and more consensual figure than the divisive Mourinho.
The Portuguese led the club to a King's Cup and La Liga title in his three years at the helm, but his final season was characterised by dressing-room splits and public disputes with players.
One of the accolades for the incoming coach was from former Milan player Paulo Maldini.
"Of all the coaches I have had, he (Ancelotti) was the one who managed the dressing room with the most serenity," he was quoted as saying on the club's website.
"The secret of our success was his normality. He isn't one of those who works alone, and this shows great intelligence. For this reason he will win titles wherever he goes: with Milan, Chelsea or Real Madrid."
Real reached the Champions League semi-finals three years in a row under Mourinho, but finished the most recent campaign without major silverware, and Ancelotti will be expected to achieve more than the Portuguese did in his time at the helm.
Most importantly, the world's richest club by revenue want to add to their nine European Cups, with the much sought-after 'Decima' (10th).
Ancelotti has plenty of experience with success at the highest levels.
He has won the Champions League twice with AC Milan in 2003 and 2007, and also lifted the Club World Cup with the Italians.
With Milan he scooped a league title and a cup, the same with Chelsea in England, and he guided PSG to the French league title last season.
Ancelotti has long held a good relationship with Real president Perez and praised him in a recent autobiography, where he credited the construction magnate with saying: "Carlo, one day you will be my coach."
Among Ancelotti's immediate tasks at Real will be to establish a working relationship with former France midfielder Zinedine Zidane, who Perez is keen to see take on greater responsibility in the direction of footballing affairs at the club.
Malaga's young midfielder Isco has been identified as a possible recruit in the short term and Real's Argentina striker Gonzalo Higuain has been linked with a possible move to Italy or England.
Photograph: Charles Platiau/Reuters