Benitez leaves Liverpool
Liverpool have confirmed manager Rafael Benitez is to leave the club by mutual consent.
The club have negotiated a settlement with the 50-year-old to end his tenure after six years at Anfield.
The development comes after a turbulent season for the Reds in which they finished a disappointed seventh in the Barclays Premier League.
Benitez told the club's website, www.liverpoolfc.tv: "It is very sad for me to announce that I will no longer be manager of Liverpool FC.
"I would like to thank all of the staff and players for their efforts. I'll always keep in my heart the good times I've had here, the strong and loyal support of the fans in the tough times and the love from Liverpool.
"I have no words to thank you enough for all these years and I am very proud to say that I was your manager.
"Thank you so much once more and always remember: You'll never walk alone."
Benitez succeeded Gerard Houllier in 2004 and memorably led the club to Champions League glory in his first season.
He followed that with FA Cup victory in 2006 and another Champions League final appearance 12 months after that, but the Premier League title has remained elusive.
The past year has been chastening with elimination from the Champions League at the group stage and failure to finish in the top four to re-qualify for the elite competition, despite a Benitez "guarantee".
Liverpool chairman Martin Broughton said: "Rafa will forever be part of Liverpool folklore after bringing home the Champions League following the epic final in Istanbul but after a disappointing season both parties felt a fresh start would be best for all concerned."
Liverpool will now begin the search for a successor but say no timescale has been put on an appointment.
Former Reds boss Kenny Dalglish, now an academy ambassador at the club, will assist managing director Christian Purslow to identify candidates.
With owners Tom Hicks and George Gillett looking to sell Liverpool, Dalglish himself has been suggested as a possible cheap, short-term option.
However, the likes of Roy Hodgson, Martin O'Neill and Guus Hiddink have already been heavily touted.
Reports the end of Benitez's reign was imminent began to appear last night but it was thought the financial situation could prove a sticking point.
Benitez signed a five-year contract in March 2009 and it was understood immediate termination could cost the club £16million.
That a compromise has been reached quickly, however, will now allow Benitez to seek immediate re-employment elsewhere.
The former Valencia boss, linked with Real Madrid and Juventus in recent months, is now being tipped as a potential successor to Jose Mourinho at European champions Inter Milan.