Rodgers joins Reading

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The Royals have agreed to pay compensation to their Coca-Cola Championship rivals starting at £500,00 which could rise to as much as £1million.

The 36-year-old only took charge at Vicarage Road in November but has left to rejoin Reading as replacement for Steve Coppell.

Rodgers - who still lives in Reading - spent nine years with the club as academy manager before being headhunted by Chelsea manager Jose Mourinho in 2004 where he worked his way up to reserve team boss.

He left last year to take charge of the Hornets and successfully guided them away from the relegation zone as well as changing the style of play and developing several young players.

However, with budgets at Vicarage Road set to again be slashed for the forthcoming season Rodgers has jumped at the chance to work at the Madejski Stadium again.

Coppell looked set to lead the Royals to promotion from the Championship for much of last season but a spectacular loss of form after January confined them to the play-offs where they lost to eventual winners Burnley.

But with players such as Stephen Hunt, Kevin Doyle and Andre Bikey at his disposal Rodgers will be confident of a return to the Premier League next May.

Watford chairman Jimmy Russo admitted that he was powerless to prevent the Northern Irishman from moving on, saying: "Once he confirmed his desire to discuss the opportunity and Reading had met a contractual compensation figure, we were powerless to prevent him from doing so.

"The board remain strongly optimistic for the future and will meet to discuss the options available."