Chelsea have been dealt a blow by the news that their former boss Jose Mourinho is expected to stay on at Real Madrid after the club sacked managing director Jorge Valdano.
The former Chelsea boss had been tipped for a potential return to Stamford Bridge this summer following the departure of Carlo Ancelotti.
Enlarge Making his point: Valdano (right), who has clashed with Mourinho this season, has been sacked
However, the dismissal of Valdano, who had several run-ins with Mourinho last season, means the Portuguese coach is likely to stay in Spain.
'The experience of the season just ended has shown the need for new organisation at the club, giving autonomy to our coach,' said Real President Florentino Perez.
'This is the first step in our reorganisation process which we will develop in the coming weeks.
Making changes: Real Madrid president Florentino Perez
'I will not hide how painful the departure of Jorge Valdano is. We have come a long way together. But my feelings cannot be a reason for not fulfilling what I believe is my obligation. Jorge, I appreciate all your hard work and dedication.'
He added: 'Mourinho did not make any demands. He asked for more autonomy in line with how English clubs are organised.'
Mourinho and Valdano have not seen eye to eye throughout the campaign as Madrid's great rivals Barcelona beat them to the Primera Division title.
The Catalans also knocked Madrid out of the Champions League at the semi-final stage, although Mourinho did lead the capital club to their first Copa del Rey success in 18 years, beating Barcelona in the final.
'What has happened is a breakdown in the sporting relationship between the coach and the managing director,' added Valdano.
'The breakdown is obvious. It's an organisational problem and that is what we are trying to fix.'
Sportsmail revealed earlier this week that Mourinho was on a four-man shortlist for the Chelsea job, alongside former boss Guss Hiddink, Porto boss Andre Villas-Boas, and rookie coach Leonid Slutsky of CSKA Moscow.
Hiddink appeared to distance himself from talk surrounding a possible return. The Dutchman, who led the Blues to an FA Cup win in 2009, is preferring to focus on Turkey's European Championship qualifier with Belgium.
'Ihave heard a lot of rumours and speculation,' Hiddink told the TV show %100 Futbol. 'I have told the players they must focus on Belgium and thesame goes for me. I am fully focused on getting the team ready for nextFriday.
Will he return? Hiddink won the FA Cup with Chelsea in 2009
'I have in mycareer very few games. I want to do more with the players on a daily basis but that is impossible because I am national team manager.
'But I am not going into the speculation as I have to prepare the team and to make sure that no one can blame me afterwards saying I was concentrating on other things.
'Iam not going into speculation, I am fully concentrated. I demand full commitment from myself so I will not go into speculation.
'I am being forced by circumstances to go into a tunnel and exclude a little bit the outside world.'
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Explore more:People: Florentino Perez, Jose Mourinho, Carlo Ancelotti Places: Madrid, Barcelona, Spain, Turkey, Belgium