Sam Allardyce will leave West Ham United by mutual agreement immediately after today's (Sunday's) final Premier League game of the season away to his former club, Newcastle United.
In a major twist, West Ham had expected to announce this Tuesday that Rafael Benitez would then take over as their manager. But it is understood that deal has broken down after a dramatic intervention by Real Madrid last week.
Real called Benitez, the former Liverpool manager who is leaving Napoli, last Monday to offer him the opportunity to succeed Carlo Ancelotti, who is expected to be sacked after today's final La Liga match of the season against Getafe.
By last Tuesday, Benitez had told West Ham that he was not going to be joining them. The decision is a serious blow to West Ham, who are now considering their options and have yet to identify a No?1 candidate.
But, despite Benitez's decision, there appears to be no chance that Allardyce will stay.
The 60-year-old, who is to fly out for a short holiday in Spain, has already received an intriguing offer to move into international management by taking over as
the coach of Nigeria, even though the current coach, Stephen Keshi, who has endured a tumultuous time, recently signed a new contract.
There is also understood to be a Premier League club who are interested in Allardyce. Although he would be keen to remain in London he does not want to return to the Championship, which rules out Fulham, who have also shown an interest.
What is clear is that Allardyce is leaving West Ham after four years in charge, and is expected to confirm this himself in the media briefings after today's match at St James' Park.
His contract expires this summer and although a meeting has been scheduled between his agent, Mark Curtis, and the club's hierarchy tomorrow it is unclear as to whether that will now take place. It may be simply to tie up any loose ends.
There is no animosity in Allardyce's departure, with West Ham believing they can move the club forward more effectively with a different manager.
However it does represent a risk given his strong track record, gaining promotion and stabilising West Ham in the Premier League, and there will be sympathy towards him.
Although Allardyce has not been universally popular with the supporters, he is liked within the club and by the players.
Having lined up a deal to bring in Benitez West Ham are now considering their options.
On their list of candidates have been Real Sociedad coach David Moyes, Bournemouth manager Eddie Howe, former West Ham player Slaven Bilic, who is leaving Turkish club Besiktas, and former Swansea City manager Michael Laudrup, whose coaching contract in Qatar is also coming to an end.