Striker Andriy Shevchenko is returning to AC Milan from Chelsea, both clubs said today.

"Chelsea have agreed terms for Andriy Shevchenko to return to AC Milan. Details of the agreement will remain confidential," said a statement on Chelsea's website.

The Ukraine forward moved from Milan to Chelsea in 2006 but struggled for form and fitness during two difficult seasons in west London.

Milan chief executive Adriano Galliani was overjoyed to re-sign the 31-year-old, who spent seven successful seasons at the San Siro.

"After a series of frenetic phone calls during the whole day, we reached an agreement with Chelsea. Tomorrow he will be in Milan, Monday he will undergo a medical and then sign a contract," Galliani told Milan's television channel.

"We have managed to bring home a player who has scored the most goals in our shirt in the last 50 years."

Galliani said earlier this week that talks over Shevchenko had stalled. Milan wanted a loan deal but Chelsea were only interested in a permanent transfer and the Serie A side have relented.