Villa end McLeish dispute with Blues

Villa have reached an agreement with arch-rivals Birmingham over the compensation paid to the Carling Cup holders following boss Alex McLeish's controverisal Second City switch.

McLeish resigned as Blues boss after three-and-a-half years at St Andrew's last month to take charge at Villa as Gerard Houllier's successor.

Blues demanded Villa pay compensation in the region of £5million for the remaining two years of McLeish's contract and initially threatened legal action, but have settled for somewhere in the region of £2.5million.

But the possibility of a battle between the two clubs has been removed via confirmation in a statement issued by City.

Birmingham's joint first team coach, Peter Grant, and chief medical officer, Dr Ian McGuinness, are also now clear to follow McLeish to Villa as the Scot assembles his backroom team.