'I have a lot of feelings at the moment,' he told reporters at a chaotic news conference as he was unveiled following Monday's sacking of Turkish coach Fatih Terim.

'It's all happened very fast and was quite unexpected...I was at an advanced stage of negotiations with Parma. I pulled out at the end and followed what my heart told me,' said Ancelotti.

'I only have one heart but it is a very big one. I feel great affection for Milan and of course great responsibility.

The 42-year-old former Italy midfielder played four seasons at Milan in the late 1980s, helping them win two European Cups. But he was also born near Parma and began his professional with the club in the 1970s before coaching them from 1996-98, taking them to second spot in Serie A in his first season - their best ever finish.

'I'm sad in a way because Parma is my city. But there was no other motivation of any kind (apart from my heart). It would not have been the same if it had been another club,' he said of Milan.

CONCRETE REALITIES

But Ancelotti said that once he began work the emotions surrounding his return would take a back-seat to the concrete realities of his new duties.

'The past is important for emotional reasons and that makes it important for me. But from tomorrow (Wednesday) I will be judged on what I do as a coach. I know there are expectations and that people expect a lot but that is what it is like with a big club,' he added.

Ancelotti has signed a contract until June 2004 and Milan vice-president Adriano Galliani said he would be working on the basis of performance-related pay.

'Carlo has accepted a contract with a relatively low fixed salary but with very important bonuses. This is the first time we have agreed a contract like this and in the future we will do the same with the players,' said Galliani.

ALREADY APPROACHED

Galliani, who effectively runs Milan on behalf of club president and Italian Prime Minister Silvio Berlusconi, also revealed that Milan had tried to sign-up Ancelotti last season, before they moved for Terim.

'To tell the truth last season we approached Juventus about Carletto but they told us they had extended his contract,' said Galliani.

Ancelotti had signed a new two-year deal with Juventus in March 2000 but was then dismissed at the end of the season.

Milan had approached Juventus about Ancelotti when they dismissed Alberto Zaccheroni and put former Italy coach Cesare Maldini in temporary charge of the team. But after being rebuffed by Juve they appointed Terim in the close season.

Terim's reign was dogged by rumours from the very first day that Ancelotti was ready to step in should the Turk fail to impress at the San Siro. Galliani said the decision to dismiss Terim was hard but the right one for the future of the club.

'I called him up and to be honest it hurt me. I did not enjoy it. He was very kind. He is not a negative type and he is a great man. We had to make a decision and evaluate the pros and cons.