West Ham confirm Julen Lopetegui as their manager after he turned down Bayern Munich, with ex-Real Madrid boss back in the Premier League after leaving Wolves in transfer cash row

Julen Lopetegui has been confirmed as West Ham's first=ever head coach as the club signalled its move into a new era.

The Spaniard has signed a two-year contract, with the option for an extra year, and takes over from David Moyes - who left the club at the end of last season.

A last-minute enquiry from Bayern Munich could not tempt the Spaniard, who was set on a move back to the Premier League - having previously managed Wolves. 

While Lopetegui has been given assurances that the club will have a sizeable budget for summer transfers, his title of 'head coach', rather than manager, means he will have less of a say on new signings.

Sporting director Tim Steidten will instead be the key lead on transfers, with sources telling Mail Sport the German had 'won the power struggle' in east London.

Julen Lopetegui has been announced as West Ham's new manager on an initial two-year deal

Steidten's increasing control over transfers was one of the reasons his relationship with Moyes became strained.

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Mail Sport reported earlier this month that Steidten had been restricted from entering the first-team dressing rooms at both the London Stadium and Rush Green training ground in the final weeks of the season amid tension with Moyes, whose future was uncertain at the time.

While Lopetegui will still be involved and give his input on potential new players, he has accepted that Steidten will be the one in control.

It is unclear whether Lopetegui, who has been out of work since leaving Wolves last summer, will reside permanently in east London. The 57-year-old still has a house in Wolverhampton but is understood to have been staying in a London flat for the last few days.

Lopetegui is understood to have been chairman David Sullivan's first-choice replacement for Moyes, while Steidten was keen on Sporting Lisbon boss Ruben Amorim - who also held talks with the Hammers.

But Steidten accepted Lopetegui was the man Sullivan wanted and a deal was sealed after a proposed move to AC Milan collapsed.

The future of Lucas Paqueta will be high Lopetegui and Steidten's agenda this summer, with the Brazilian keen on a move to Manchester City after a deal collapsed last year.

The playmaker has a release clause of £75million and a sale would free up more money to be spent on new signings, but both parties are awaiting the outcome of the Football Association's investigation into alleged breaches of its betting rules. Paqueta denies any wrongdoing.

The defence has been highlighted as an area where improvement is needed after West Ham went 18 Premier League games without a clean sheet in the second half of last season.

The club are working on bringing in 28-year-old centre-back Fabricio Bruno from Flamengo for a fee of around £12m. Hull City's Jacob Greaves is also a target, but face competition from other Premier League clubs while the Tigers will also push hard to keep him.

In the attacking areas, the club are still looking at Serhou Guirassy from Stuttgart, who would cost around £15.5m, while Sevilla's Youssef En Nesyri is also of interest.

Mail Sport reported earlier this month that the Hammers are also eyeing a move for Corinthians teenager Wesley, who can play as a striker or on the wing.

Steidten was in Sao Paulo last summer for talks with the seven-time national champions over other potential targets, but interest in Wesley has ramped up over the past few months.

Outgoings are also expected, with full back Ben Johnson expected to leave when his contract expires this summer. Michail Antonio could also be on the move, with the striker attracting interest from the MLS and Saudi Arabia.

A squad high turnover is likely but that will not decrease the expectations of Lopetegui, with a return to Europe the club's goal for next season.

Speaking about his appointment, Lopetegui said: 'I feel that we have a fantastic platform. I think the last few years have been very good years to have this base, of course, but my ambition as a coach is always to be better and better, to achieve more and bigger aims and to encourage and improve the players, the team, and to compete because football is about this – to compete. We are very ambitious about this.

'I am where I want to be. I am here because I want to be here and for us it was a fantastic day when we closed our agreement here because our commitment is 100 per cent. We had other opportunities but I am very happy that West Ham chose me because I chose West Ham too, so we are really happy about this.

'We came here with the idea and the thought to make a big, big noise. That's why we came here, and we are excited by this challenge. Of course, we are going to do our best to help the club and the team to achieve to achieve the best level and to achieve our aims. I assure the fans that they are going to be key in all our achievements.'