Ancelotti put his signature to a three-year deal at Stamford Bridge on Monday morning to end speculations over his future.

The 49-year-old was heavily linked up with the Blues after the departure of temporary manager Guus Hiddink, who was appointed upon the sacking of Luiz Felipe Scolari early this year.

"Chelsea Football Club is delighted to announce that Carlo Ancelotti has agreed to become our new manager," a statement on the London club's official website said.

"He has signed a three-year contract and will start on July 1, 2009.

"Carlo was the outstanding candidate for the job. He has proved over a long period his ability to build teams that challenged for, and have been successful in, major domestic and European competitions.

"He also had a highly successful playing career in those competitions and therefore brings unparalleled all round experience to the job.

"We are sure everybody at Chelsea will give him a warm welcome and we are all looking forward to working with him."

Ancelotti took charge of several Serie A clubs throughout his coaching career, and managing Chelsea will be his first experience with a non-Italian outfit.

The former Parma and Juventus boss claimed a Serie A title and won the UEFA Champions League twice during his eight-year stint with Milan.

Now he's planning to win the Champions League with the Premier League giants.

Beautiful Sensation

"For me, the Champions League is a beautiful sensation. When I played I won two times, in 1989 and 1990. It was a fantastic moment," Ancelotti stated.

"It was the same when I was a coach in Milan in 2003 and 2007. The Champions League, for me, is the best competition in the world and everyone wants to win.

"Chelsea has a great record, five semi-finals in six years is a beautiful score, but now we have a need to win. I hope!"

Chelsea, who won all domestic titles over the past years, haven't claimed their first Champions League trophy yet.

Claudio Ranieri, Jose Mourinho, Avram Grant and Hiddink all came close to winning the continental accolade, but eventually failed to snatch it.

Now Ancelotti is trying to outclass his predecessors and add more trophies in Chelsea's cabinet.

"At Chelsea it is easy to find the objective. Win the Champions League, win the Premier League, win the FA Cup, win the Carling Cup," he said.

"Naturally, it is not easy, but the right way is to create a group of people who work well together."