Sir Alex Ferguson has had his contract with Manchester United ripped up by INEOS.

Old Trafford chiefs have ended an annual commitment to the legendary manager as part of cost-cutting measures, The Athletic reports.

It's reported the Scottish icon has received £2.16m from the club for ambassadorial services to the club since his departure from the dugout.

However, now the deal - where Ferguson worked as a global club ambassador and club director -has been ended with INEOS chiefs desperate to cut costs at Manchester United.

As a result, executives honed in on the annual payment to Ferguson, 82, and decided to end the agreement.

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It's reported Sir Jim Ratcliffe met with Ferguson to inform him that the club would no longer pay the annual salary as part of efforts to lower costs.

Ferguson is expected to remain as a non-executive director at Manchester United and be welcomed to matches. The former Aberdeen manager regularly sits in the director's box at fixtures.

The football legend is thought to have remained as a director on the club football board. It's a role previously held by Sir Bobby Charlton. Ferguson is not on the official board at Manchester United.

According to The Athletic, the Glazer family had previously been "satisfied" to pay Ferguson the annual salary due to belief that much of the value in the club was still generated as a consequence of Ferguson's impact at Old Trafford.