By North-west correspondent Alex Stevens

Pep Guardiola has been appointed the new Manchester City manager, the club announced on Monday afternoon.

The Bayern Munich boss will replace Manuel Pellegrini at Etihad Stadium in the summer.

Guardiola has signed a three-year contract as City confirmed negotiations were a recommencement of talks with the former Barcelona boss in 2012.

City released a statement to explain whey they had made the announcement with four months of the season remaining.

“Manchester City can confirm that in recent weeks it has commenced and finalised contractual negotiations with Pep Guardiola to become MCFC head coach for the 2016-17 EPL season onwards,” the statement read.

“The contract is for three years. These negotiations were a re-commencement of discussions that were curtailed in 2012.

“Out of respect for Manuel Pellegrini and the players, the club wishes to make its decision public to remove the unnecessary burden of speculation.

Final season: Pellegrini will step down as manager in the summer

Final season: Pellegrini will step down as manager in the summer

“Manuel, who is fully supportive of the decision to make this communication, is entirely focused on achieving his targets for the season ahead and retains the respect and commitment of all involved with the leadership of the club.”

Pellegrini revealed at his media conference on Monday that he will step aside on 30 June.

“I talked with the club and told them I will finish my contract on the original date,” explained Pellegrini. “I could have extended my contract for one more year, but decided not to.

“There has been a lot of speculation, but they (Manchester City) are not doing nothing behind me. I don’t think it’s good for this room to be speculating about me so I told press and players and spoke with the club two weeks ago.”