Manuel Pellegrini's set for talks with West Ham United – after leaving Hebei China Fortune.
Newcastle United manager Rafa Benitez was on the club's managerial shortlist following the departure of David Moyes.
However, the Gazette reported earlier this week that Pellegrini was West Ham's No 1 target.
And the former Manchester City manager will now have discussions with the club after leaving his post.
A statement from the Chinese Super League club read: "After amicable discussions with Mr Pellegrini, we have reached a mutual agreement.
"As of May 20, Mr Pellegrini will no longer work as the head coach of Hebei China Fortune.
"We sincerely thank Mr Pellegrini for his contribution to the club and we wish him all the best for the future."
Pellegrini was quickly identified as West Ham's first-choice target.
Speaking earlier this week, West Ham co-owner David Sullivan said: "This is an exciting time for our football club. We are preparing to appoint a manager who has a proven record of success at the highest level of the game."
Meanwhile, Benitez's representatives are in talks with Newcastle over the club's summer transfer budget.
The 58-year-old – who has been offered a new United deal after keeping the club in the Premier League – is looking for a number of assurances from the club's hierarchy.