Carlos Queiroz has accepted an offer from Alex Ferguson to return to Manchester United as assistant manager. The sacked Real Madrid coach informed United of his decision last night and hopes to fly in to Manchester this week to finalise a two-year contract.

Two weeks after being sacked as coach at the Bernabeu, Queiroz will take the place of Walter Smith on the backroom staff.

Smith's short-term contract expired on Monday, having worked alongside Ferguson during a difficult three-month period that saw them eliminated from the Champions League by Porto and then surrender the title to Arsenal, although they did remove the Gunners from the FA Cup and go on to win it.

Ferguson has been monitoring Queiroz's position for weeks, since it became apparent that the former Portugal and South Africa coach would be sacked by Real Madrid at the end of a hugely disappointing season for the deposed Spanish champions.

As well as finishing only fourth in the league, meaning that, like United, they will have to play in next season's Champions League qualifiers, Real ended the season by setting an undistinguished club record of losing five successive league matches.

Queiroz's recruitment from Old Trafford a year ago was subsequently described as a "mistake" by the Spanish club's president Florentino Perez.

Ferguson, however, has never lost faith in the Portuguese, who has also been linked strongly with a move to Tottenham. In an impassioned defence of his former assistant recently, Ferguson even argued that Queiroz should be absolved of the majority of blame for Real's poor season.

The blame should have been Perez's, according to Ferguson, for selling players and, he claimed, weakening the first-team squad from the previous season.

The United manager has spoken at regular intervals with Queiroz and, as soon as Perez announced that the former Spain coach Jose Antonio Camucho would be moving to the Bernabeu, Ferguson instructed United's board to make a formal offer. All that remains now is for Queiroz to meet United's chief executive David Gill to finalise the details of his contract, but no complications are anticipated.

Ferguson is currently on holiday so will not be present, but he has been advising Quieroz by telephone and they will link up again for United's pre-season tour of the United States.

Meanwhile, midfielder Nicky Butt revealed he will reconsider his Old Trafford future after the Euro 2004 finals.

"It's difficult" he said, "I haven't been playing regularly and I don't want to be in the same boat next season, especially now we have these transfer windows.