Ex-Barcelona boss Frank Rijkaard is also being touted once again as a strong candidate but Chelsea aides have been impressed with Luciano Spalletti of Roma and Cesare Prandelli of Fiorentina.

Roman Abramovich’s inner circle also have to decide soon whether to enter the bidding for Mark Hughes, after Manchester City agreed £5million compensation with Blackburn and opened talks with the Welshman, who would go to Chelsea like a shot – if asked.

Speculation about a deal being sealed for Ancelotti – fuelled by rolling TV sports news programmes – looked premature when both Chelsea and Ancelotti spoke out.

“Contrary to reports Chelsea has not reached agreement with any individual to become manager,” the club said.

Ancelotti added: “I’m staying at AC Milan for sure, and for many seasons to come. I’ve not spoken to anyone at Chelsea – any other reports are football talk and pure speculation.”