Kenny Dalglish.

Kenny Dalglish. Photo: Reuters

Liverpool legend Kenny Dalglish has been sacked as manager of the club in a dramatic move by the owners following a disappointing Premier League campaign.

The 61-year-old Scot, who had returned for a second stint as manager at Anfield in January last year, paid the price for a dismal season, which saw Liverpool finish 37 points behind champions Manchester City.

The Merseyside club's American owners, the Fenway Sports Group (FSG), had given Dalglish more than £100 million ($160 million) to spend in the transfer market since he took over from the sacked Roy Hodgson in 2011.

But expensive signings such as Andy Carroll, Stewart Downing, Jordan Henderson and Charlie Adam have largely flopped, with Liverpool's eighth place finish their worst season-ending position for nearly two decades.

Dalglish remains an iconic figure among Liverpool's supporters following an association with the club that straddles five decades.

He was a key figure in the club's 1970s and 1980s glory years, a spell that saw him win eight league titles as player and manager between 1979 and 1990, as well as three European Cups in 1978, 1981 and 1984.

Dalglish is also revered for leading Liverpool through the dark days following the 1989 Hillsborough disaster, attending many of the funerals of the 96 fans who perished in the tragedy, including four in one day.

But his second spell at Anfield was less harmonious, and he suffered a critical mauling for his handling of the Luis Suarez racism affair this season.

Dalglish's steadfast support of the Uruguayan striker, who had been found guilty by an independent FA tribunal of racially abusing Manchester United defender Patrice Evra, was widely perceived as a public relations disaster.

Although Dalglish ended Liverpool's six-year trophy drought this season with victory in the League Cup, the club were comfortably beaten by Chelsea in the FA Cup final earlier this month.

Liverpool lifted the gloom with a 4-1 win over Chelsea in their final home game of the season, but a 14th loss against Swansea in their last game of the campaign on Sunday was the last straw.

The defeat against the newly promoted Swans, whose squad cost a fraction of Liverpool's to assemble, left Liverpool in eighth - their worst finish for 18 years, with their lowest points tally since 1953/54.

Dalglish had flown to the United States on Sunday to present his end-of-season review to principal owner John Henry and chairman Tom Werner, who had only last month given the Liverpool legend his backing.

Indeed, Dalglish's position seemed to have been strengthened when French director of football Damien Comolli abruptly left the club on April 12, having apparently taken the blame for Liverpool's poor results.

British media reports have already linked several younger up-and-coming managers to the vacancy at Anfield, with Wigan's Roberto Martinez, Swansea's Brendan Rodgers and Norwich's Paul Lambert all mentioned as possible candidates to succeed Dalglish.

AFP