Rafael Benitez yesterday began to prepare for life at Liverpool after tearfully tendering his resignation at Valencia, potentially paving the way for Claudio Ranieri to make a return to the Spanish champions.

It was reported yesterday evening in the Spanish media that Valencia directors flew out to London last night to hold talks with Ranieri about the vacancy.

Liverpool intend to unveil Benitez as Gerard Houllier's successor at Anfield within the next two weeks after the 44-year-old's representatives reached agreement with the chief executive Rick Parry in talks last month.

They hope the Spaniard can emulate the domestic successes he enjoyed with Valencia in the Spanish League - where he won the title twice in his three-year spell - in the Premiership.

Benitez's switch to Merseyside could now prompt Ranieri to make a surprise return to the club where he enjoyed two seasons in the late 1990s.

The former Valencia president and major shareholder Francisco Roig has already contacted the Italian's representatives and claimed he had shown "a strong desire to return to Valencia as soon as he has resolved his contractual situation with Chelsea".

That dispute revolves around the manager's pay-off - he was sacked on Monday with three years to run on his contract at Stamford Bridge, equating to around £6 million in compensation.

Chelsea are unwilling to pay that amount and, while Ranieri returned to London last night for a charity function, his agent, Jon Smith, was still in negotiations with the club over the issue.

For their part, Liverpool expect the arrival of one of Europe's most highly-rated young coaches to please both Steven Gerrard and Michael Owen, who is yet to sign a new contract.

The former Tenerife coach will sign a long-term deal once Parry returns from a holiday in Barbados, though Benitez will work out his 14-day notice period at the Mestalla.

Emotion got the better of him yesterday, forcing him to leave his farewell press conference in tears before he had finished delivering a prepared statement.

"This had been possibly one of the most difficult decisions I have had to take in my sporting career," he said at Valencia's Paterna training complex.

"I am not going to continue as coach. I want to see it as positive that the club has tried to keep me on but, after the events of this season which have taken their toll on me both physically and mentally, I have decided to reconsider my situation at the club."

Those strains were born of an increasingly fractious relationship with Valencia's sporting director, Jesus Garcia Pitarch, who was in charge of the club's moves in the transfer market.

The president Jaime Orti's reluctance to remove Pitarch ultimately scuppered any attempts to persuade Benitez to sign a two-year extension to his contract.

"Valencia not only did everything possible to ensure Rafa stayed on for the remaining year of his contract but also tried to get him to extend his deal," said Orti.

"It was his decision, not ours. But he felt his cycle at the club had come to an end. It took us all by surprise."

"With regards to my professional future," added Benitez, "I'm going to take a few days out to analyse the options that are open to me and I will choose the one that suits me best."

Both Internazionale and the Turkish club Besiktas had expressed an interest in hiring the Spaniard, though his long-standing desire to coach in England - where he will also be able to dictate transfer policy - will see Benitez confirmed at Liverpool.

He is likely to bring his fitness coach and number two at both Tenerife and Valencia, Francisco Ayestaran, with him and could supplement the playing staff with the signings of the Argentinian pair Roberto Ayala and Pablo Aimar, as well as the Spanish international goalkeeper Santiago Canizares.

And while the dramatic developments were unfolding in Spain, it emerged that the £60 million bid by Thailand's Prime Minister Thaksin Shinawatra for a 30 per cent stake in the club was still alive, providing the cash to raid the European transfer markets.