Carlo Ancelotti returns to Real Madrid as replacement for Zinedine Zidane

Real Madrid on Tuesday named Italian Carlo Ancelotti as their new first team coach after Zinedine Zidane's decision to step down last week.

61-year-old Ancelotti leaves Everton, who he led to a tenth-place finish in Premier League last season to go back to Real Madrid, whom he coached between 2013-2015, leading the club to the Copa del Rey and the 10th Champions League in their history, along with the World Club Championship.

The Real Madrid website announced that Ancelotti has agreed a three-year-contract with the Spanish club who last season finished second in La Liga behind neighbors, Atletico Madrid.

The club had looked at several possible candidates to replace Zidane, among them, Paris Saint Germain coach, Mauricio Pochettino, Real Madrid B-team coach, Raul Gonzalez and former Inter Milan boss, Antonio Conte.

The fact that PSG were unwilling to allow Real Madrid to talk to Pochettino, while Conte was considered too authoritarian as a coach and Raul is still gaining experience, saw Ancelotti emerge as the surprise favorite for the role late on Monday as negotiations advanced at a rapid pace.

Ancelotti was a popular coach at the Spanish club during his first period at the Santiago Bernabeu Stadium, winning the respect of players and fans. However, his failure to win the La Liga title in his second campaign with the club saw him sacked at the end of the 2014-15 season with a year still left on his contract.

At the time Real Madrid president, Florentino Perez said the sacking was "a very difficult decision," but added that "at this club the demands are huge and we need a new impulse in order to win trophies and be at our best."

Ancelotti is one of the most successful coaches in history and also one of just seven men to win the Champions League as a player and as a coach. He has coached a long line of top European clubs, such as AC Milan, Chelsea, Juventus and Bayern Munich, with his last two jobs at Napoli and Everton.

He returns to a Real Madrid that is at a difficult moment, with club captain, Sergio Ramos looking likely to leave at the end of June, while other key players, such as Luka Modric, Toni Kroos and Karim Benzema are comfortably in their 30s. Real Madrid will hope that Ancelotti will be able to ease through a generational change in the coming season and hopefully also bring the best out of Eden Hazard who has disappointed in his two seasons at the club.