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Pellegrini, who never had the support of the pre-Madrid press, signed a two year contract with the club and his sacking will cost around 4 million Euros (five million dollars).
Real Madrid will almost certainly now embark on another summer of big spending with players such as Ashley Cole, Frank Lampard, Di Rossi and Diego Milito high on the club's shopping list.
Interestingly the only trophy won by any of the six coaches appointed by Perez was the 2003 Spanish Supercup, which was won when the side coached by Carlos Quieroz beat Mallorca.