The FA has confirmed Fabio Capello as the new England manager after minor details in the Italian's contract were resolved this afternoon.

The 61-year-old former manager of Juventus, AC Milan and Real Madrid succeeds Steve McClaren after the Englishman failed to guide his country to the Euro 2008 Championships in Austria and Switzerland.

Capello has signed a four-and-a-half year contract believed to be worth £6.5m a year. He will begin work on January 7th.

"I am delighted that Fabio Capello has agreed to become England manager," said FA chief executive Brian Barwick this afternoon.

"When we set out to recruit the new manager, we said we were committed to appointing a world-class candidate. In Fabio Capello we have that man.

"Fabio is a winner. His record over the last two decades speaks for itself.

"At every club he has managed Fabio has won the league title and Trevor Brooking and I were left in no doubt of his passion and commitment to bring that  success to the England team."

Capello will officially be unveiled in central London on Monday, just under four weeks after McClaren was sacked.

The Italian made his desire to take the job known almost immediately and was quickly installed as the number one candidate once former Chelsea boss Jose Mourinho backed out of the running at the weekend.

Capello's standing in the game mean his services come at a price.

His estimated £6.5m annual salary dwarfs the amount Sven-Goran Eriksson commanded, although, if he delivers what the FA feel he is capable of, it will be money well spent.

Capello's contract takes in not just the 2010 World Cup qualifiers but the campaign to reach Euro 2012 as well. His first official game in charge will be against Switzerland at Wembley on February 6th.

"Fabio Capello is widely recognised as one of the world's finest coaches," said FA director of football development Trevor Brooking.

"He has achieved huge success wherever he has worked and has the respect of everyone in football.

"Fabio will have the full support of the FA and its coaching set-up. We are excited about working with him over the coming years as we focus on qualification for the 2010 World Cup in South Africa."

Capello will liaise with Brooking over the installation of an English presence within a coaching team which has already been confirmed will include assistants Franco Baldini and Italo Galbiati, goalkeeping coach Franco Tancredi and fitness  coach Massimo Neri.