Watford have sacked head coach Paulo Pezzolano after just five months in charge and replaced him with former boss Javi Gracia.
Crunch talks were being held on Tuesday and the club hierarchy have now parted ways with Pezzolano, who becomes the 12th manager Watford have sacked in just five years.
Gracia, who was previously in charge for 66 games at Watford between January 2018 and September 2019, was the number one target to replace Pezzolano and has now agreed to return to Vicarage Road.
On Gracia's return, chairman and chief executive Scott Duxbury said: "We are very pleased to welcome back Javi. His passion, leadership and clear strategy will help us build stability, unity and momentum.
"We are sure there are many supporters who wished Javi had never departed in 2019. With this young and exciting squad we are convinced his experience and qualities are exactly what we need now."
Pezzolano: Results showed we were building in right direction
In a statement posted on social media, Pezzolano said he believed he had Watford on the right path towards Premier League promotion.
"Watford FC have told me that our paths are going separate ways," read his statement. "After months of intense work at every level, the results showed that we were building in the right direction to reach our goal of returning to the Premier League this season, with a squad capable of achieving it. We had full confidence in that and a firm belief that we could do it, always staying true to our principles.
"Those who know me understand that, both on and off the pitch, my values, principles, and ethics never waver. I have always worked - and will continue to work - guided by these standards, without exception.
"I want to thank the players for their attitude, commitment, and the respect they have shown towards me and the entire coaching staff. My thanks also go to all the club employees, whose daily effort and cooperation we value deeply.
"From the first day, my family and I have felt at home here, and that's why I sincerely hope Watford achieve the promotion their people truly deserve. With gratitude, Paulo Pezzolano."
Pezzolano's reign third shortest at Watford
Pezzolano was appointed by the Hornets on May 13, replacing Tom Cleverley, who was sacked seven days earlier.
The Uruguayan endured a mixed start in the Championship this season after being backed heavily in the transfer market.
He took charge of 10 competitive games in all competitions. Watford picked up only five points from their first six Championship games, but they have taken seven points from the last three and moved to within three points of the play-off places.
Pezzolano saw his side come from behind to beat Oxford 2-1 last weekend in his final game in charge.
The 42-year-old's reign is the third shortest in Watford's history, behind only Oscar Garcia (four games, September 2014) and Billy McKinlay (two games, September to October 2014).
Watford analysis: Pezzolano lost the dressing room
Analysis from Sky Sports News' Anthony Joseph:
Watford have sacked Pezzolano as they believe he lost the dressing room, after just 10 games in charge of the club.
It's understood he had fallen out with a number of players in the squad during his five months as head coach.
The club did their research and spoke to the City Group before appointing the 42-year-old, but they believe he tried to change too much, too quickly - and not in the correct manner.
The Watford hierarchy accept that 11th place and nine points is not the worst of starts, however, they believe Gracia will get even more out of the squad which they heavily invested in in the summer. They tried to get Gracia in the summer but he was recovering from surgery and was not in a position to take the job.
It's believed club chiefs have been baffled by some of the decisions Pezzolano has made - most notably only starting forward Kwadwo Baah twice in the league and on-loan centre-back Formose Mendy, once, at right wing-back.
Feedback from players to the board has been that instructions about formation and tactics have not been clear.
It's understood Watford's hierarchy don't feel Pezzolano made the effort to connect with the fans - only doing interviews in Spanish. Fans sang "you're getting sacked in the morning" at half-time in their 2-2 draw at Portsmouth last week.
Chairman and CEO Scott Duxbury is the one who has driven to get Gracia back so soon. The board are accepting that it was a mistake to sack him in September 2019.
In his first spell at Vicarage Road, he steered the club to Premier League safety in 2018. The next season he took Watford to the FA Cup final and finished 11th in the league - their highest top-flight position since 1987.
However, he was sacked in his third season - with the club sitting bottom of the Premier League in September 2019.
That FA Cup run is still fairly fresh in the memory of the Watford support, who hold him in high regard.
Gracia was last in charge of Leeds United, when he replaced Jesse Marsch in February 2023.
The 55-year-old steered Leeds out of the relegation zone, but was relieved of his duties in May that year.
