Rafael Benitez is staying as Newcastle United manager after signing a new three-year contract following their relegation from the Premier League.

The 56-year-old Spaniard was appointed in March following Steve McClaren's sacking but failed to keep the Magpies in the top flight.

He had a break clause in his contract if Newcastle were relegated and was widely expected to leave the club.

"The love I could feel from the fans was a big influence for me," he said.

Former Liverpool, Chelsea, and Real Madrid boss Benitez will have control over "all football-related matters" at the club, Newcastle said.

His predecessor McClaren was named as head coach last summer, working alongside chief scout Graham Carr.

"This is a huge club and I wanted to be part of the great future I can see for Newcastle United," added Benitez, who has also managed Valencia, Inter Milan and Napoli.

Benitez, who was sacked by Real in January, took over with Newcastle one point adrift of safety.

Despite losing only three of his 10 matches in charge, the Magpies were relegated with one game of the season remaining as north east of England rivals rivals Sunderland survived.

Newcastle managing director Lee Charnley said the club was delighted to keep Benitez, who he described as a "world-class" manager.

"When we brought Rafa to the club in March, we knew he was a phenomenal manager and everything we have seen from him since has only served to reinforce that," he added.

Former Newcastle striker Alan Shearer said earlier this month he would be "amazed" if Benitez stayed at St James' Park.

Shearer, who managed Newcastle briefly in 2009, told BSports: "I'm sure he'll have loads and loads of offers, not only from the Premier League but from around the world."

More to follow.