Chelsea are set to be dealt a huge blow as Atletico Madrid prepare to finalise a new deal for coach Diego Simeone, according to Spanish newspaper AS.
The Blues are expected to replace interim boss Rafa Benitez in the summer and Simeone, the former Argentina international, is one of their main managerial targets.
The 42-year-old took over at the Vicente Calderon in December 2011 and guided the capital club to success in the Europa League and European Super Cup, where his side thrashed Chelsea 4-1.
Simeone has overseen a strong league campaign this season - Atletico are currently second behind Barcelona and are four points in front of rivals Real - and he had been tipped to move to Stamford Bridge later this year.
But AS claim Atletico are on the verge of concluding negotiations with the Argentinian over a four-year contract extension, which will tie him to the club until 2017.