ENGLAND manager Sven-Goran Eriksson will leave his £4m-a-year post after the World Cup, the Football Association said last night.

The news came after the Swede spent the day in a series of meetings with his bosses at the FA's London headquarters in Soho Square.

The FA later confirmed that, once England have competed in the World Cup finals in June and July, Eriksson will part company with the national team, two years before his contract expires in 2008.

The news follows successive weekends of damaging revelations in the News of the World, after Eriksson and his advisors were led to believe an undercover reporter was a rich Arab sheikh who wanted to give the Swede a job.

A compensation package has been agreed in order for Eriksson to end his career in charge of England.

Neither the FA nor Eriksson's advisors are revealing the terms of the deal, but both sides are understood to be satisfied with the terms.

The announcement will spark a rush for what is the best-paid job in international football, and FA chiefs have some tough decisions to make over whether they want an Englishman in charge or another foreigner with proven international experience.

One thing they will be is careful. After Eriksson's affairs with Ulrika Jonsson and Faria Alam, and on three occasions being found out to have had talks about leaving England for a Premiership club, the FA will want someone loyal.

The final nail in Eriksson's coffin came when he told an undercover reporter that he would quit as England coach if the team wins the World Cup this summer, and suggested the "Arab" buy Aston Villa and pay him £5m a year after tax to be coach.

He also made indiscreet comments about senior England players, and suggested some Premiership managers took bungs when arranging transfers.

A statement on www.thefa.com included comments from Eriksson and FA chief executive Brian Barwick.

It said: "The FA can confirm that Sven-Goran Eriksson will leave his post as England head coach after the World Cup in Germany."

Eriksson said he cared "passionately" about his job.

He added: "I am happy that we have reached this agreement and can now continue our preparations for the World Cup.

"I know that I have the full support of the players and the FA, and it is important to stress to everyone just how committed I am to achieving success this summer.

"I care passionately about this job, and I want everyone to know that. I have always enjoyed the incredible support of the fans and I know how important they will be to us in Germany.

"This summer is the culmination of everything we have been working towards over the last five years. Let's go and win the World Cup."

Barwick said: "The FA and Sven felt it was important to clarify his future. This is for the benefit of everyone connected with English football, especially the fans.

"Sven is definitely the man to lead us in Germany. Now is the time for everyone to get behind the team as we prepare for a tournament that presents us with a genuine chance of success."

Meanwhile, the name of Graeme Souness is still hanging on the Newcastle United manager's office door.

The 52-year-old emerged from a brief meeting with club chairman Freddy Shepherd yesterday afternoon still in charge at St James' Park - despite intense speculation that his reign was drawing to a close.

Shepherd has made no secret of his displeasure at recent results and last week warned that injuries would not excuse a failure to qualify for Europe.

* Bolton boss Sam Allardyce has emerged as favourite to succeed Eriksson as England coach.

Allardyce, who has established Bolton as a Premiership force, is seen as the pick of English managers by bookmakers. However, Charlton boss Alan Curbishley, Middlesbrough's Steve McClaren, former Bayern Munich boss Ottmar Hitzfeld and Martin O'Neill have also emerged as potential contenders.