Chelsea this evening confirmed their intention to install the 33-year-old as the replacement for Carlo Ancelotti, who was unceremoniously axed at the end of last season just 12 months after guiding the club to a league and FA Cup double.

“We note that the release clause of Andre Villas-Boas has been activated,” a Chelsea club statement read.

“We can at this time confirm our interest in him and hope to reach agreement with him on personal terms and make a further announcement in the near future.”

Porto confirmed in a statement to the Portuguese Securities Market Commission, that the full buy-out clause had been met by Villas-Boas himself, although it is likely to have come via the deep pockets of Chelsea owner Roman Abramovich, who has already spent millions in cutting short contracts of previous managers and players.

The statement read: “FC Porto, in accordance with Article 248 paragraph 1 of the Securities Code, hereby informs the market they have received from Mr Andre Villas-Boas the amount provided for in clause to terminate his employment contract.”

It added that all that remained to sort out were the formalities of the termination of the contract.

Porto have moved swiftly to appoint a replacement coach, with Vitor Pereira stepping up into the hotseat after apparently turning down the chance to move to England with Villas-Boas.

It had appeared that Guus Hiddink – who enjoyed a successful spell as caretaker boss at Chelsea in 2008-09 and continues to enjoy a close relationship with Abramovich – was set to take up a sporting director role at Stamford Bridge once his exit from the Turkish Football Federation was agreed, with compensation set at around £4m.

However, it now seems that scenario failed to get off the ground as Chelsea turned their attentions to appointing an up-and-coming coach to oversee first-team affairs.

Villas-Boas would certainly fit the bill after guiding Porto to domestic and Europa League success last season. He is also no stranger to the west London club, having worked there under Jose Mourinho.

One of his first moves as the new Blues boss could be to sign Porto’s star striker Falcao, the £25m-rated Colombian having impressed as the Dragons won the Europa League final at Dublin’s Aviva Stadium, where the 25-year-old netted the only goal against Braga.

That could then signal the departure of Didier Drogba, with AC Milan said to be ready to offer the veteran Ivory Coast striker a fresh start in Italy.