Manchester City manager Roberto Mancini is to be sacked within a fortnight and replaced by Malaga coach Manuel Pellegrini.
After the match, Mancini, 48, criticised the club for failing to back him and quash rumours about his future, which he claimed unsettled the squad and was partly responsible for the defeat.
Despite winning the club's first league title in 44 years last season, the City board are understood to be disappointed at the club crashing out of the Champions League at the group stage for a second successive season, and their inability to build on last season's triumph by finishing second in both the Premiership and FA Cup.
The club reportedly first approached Pellegrini in January, with bosses also unhappy about Mancini's poor relationship with players, staff and executives.
Chilean Pellegrini, 59, is widely respected by observers in Spain, after guiding unfancied Malaga and Villareal into the Champions League, where both clubs punched above their weight.
He was in charge at Real Madrid in the 2009-2010 season, but was sacked after only a year after his team were beaten to the Spanish title by Pep Guardiola's Barcelona.
Mancini, who won two Serie A titles with Inter Milan, will take charge of City for their two remaining games of the season, at Reading on Tuesday and at home to Norwich on Sunday.
He is expected to take charge at AC Monaco, where he held talks at the end of last season.