Brendan Rodgers has resigned as Celtic manager - amid accusations from major shareholder Dermot Desmond of "divisive, misleading, and self-serving" behaviour - and will be replaced in the interim by former boss Martin O'Neill.

The Scottish Premiership champions slipped eight points behind early pacesetters Hearts after losing meekly at Tynecastle on Sunday, having endured a hugely underwhelming European campaign and angst-ridden transfer window. Yet for all that discontent has been in the air around Celtic Park, the news that emerged in a club statement at 21:44 GMT was stunning.

The 134-word missive announced that Rodgers had quit, thanked him for his contribution across his two spells as manager, and said the process to appoint a replacement was underway. In a remarkable twist, it also noted that O'Neill - 73 years old and 20 years after his first stint ended - would take interim charge, assisted by former Celtic player Shaun Maloney, who was sacked as Wigan Athletic manager in March.

While Celtic fans were digesting that, the club published another similar staggering statement 15 minutes later - this time signed by the usually reticent Desmond. In an astonishing letter to fans, he challenged Rodgers' assertion that he was formally offered a contract extension, denied that signings were imposed upon the manager, and criticised his "desire for self-preservation at the expense of others".

Rodgers, 52, began a second spell at Celtic Park in 2023, winning successive titles to go with his league triumphs from 2017 and 2018. The former Liverpool and Leicester City boss departs with the champions trailing Hearts by eight points after nine Scottish Premiership games. The Northern Irishman agreed a three-year deal on his return and repeatedly stressed that he would honour the contract since his departure in February 2019 for Leicester had caused so much rancour.

When quizzed about extending that agreement in August, Rodgers insisted there had been no formal offer. But Desmond has now given his side of events, saying the club were keen to keep him beyond the end of this campaign to "reaffirm the club's full backing and long-term commitment to him". The Irish businessman went on to say that Rodgers' assertion that no offer had been made was "simply untrue".

This season has played out against a backdrop of anti-board protests at Celtic Park and Desmond went on to suggest Rodgers had contributed to a "toxic atmosphere". Another feature in the opening months of this term was Rodgers' apparent dismay over transfer business, with several references to underwhelming recruitment. Speaking after the 2-0 loss at Dundee on 19 October, the manager said: "There's no way you'll go into a race and be given the keys to a Honda Civic and say 'I want you to drive it like a Ferrari'. It's not going to happen."

But Desmond has responded by saying: "Every player signed and every player sold during his tenure was done so with Brendan's full knowledge, approval, and endorsement. Any insinuation otherwise is absolutely false. "His later public statements about transfers and club operations came entirely out of the blue. At no point prior to those remarks had he raised any such concerns. "In reality, he was given final say over all football matters and was consistently backed in the recruitment process, including record investment in players he personally identified and approved. "Regrettably, his words and actions since then have been divisive, misleading, and self-serving. They have contributed to a toxic atmosphere around the club and fuelled hostility towards members of the executive team and the board. "What has failed recently was not due to our structure or model, but to one individual's desire for self-preservation at the expense of others."

O'Neill managed Celtic from 2000-05, winning three Scottish Premier League titles, three Scottish Cups, and a League Cup. He also took the club to a Uefa Cup final. However, he has not managed a club since he being sacked by Nottingham Forest in June 2019 - more than six years ago.

Coincidentally, the former Republic of Ireland manager was on TalkSport earlier on Monday taking about the Scottish title race - and his belief that Hearts could become the first non-Old Firm side to win it since 1985. "Hearts have shown a great determination. Their record is great, at this minute," O'Neill said. "With Celtic not being as strong, as physically as strong, as maybe you would want them to be. It is possible. "Celtic can actually lose games now, whereas before, they looked invincible in matches. Rangers are no threat whatsoever. They are so far adrift it's untrue. "But this is the moment, this is the time for Hearts. They have gone eight points clear. That is a decent enough lead, really. Their confidence has grown, and it will grow from that victory."

O'Neill will be joined by Maloney, who had two spells as a player with Celtic and was part of Belgium's coaching staff for a stint after retiring. The Scotland international took on his first job with Hibs in 2021 but lasted just four months. Then he took charge of Wigan Athletic in January 2023 but was dismissed in March of this year, having won 42 of his 115 games in charge.