Real Madrid are reportedly unhappy with the timing and financial terms surrounding Carlo Ancelotti’s expected departure, casting doubt over his potential move to become head coach of Brazil, sources have told ESPN Brasil.

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Earlier reports suggested that the Brazilian Football Confederation (CBF) was hopeful of finalizing a deal for Ancelotti in time for Brazil’s World Cup qualifiers in June. However, talks have now stalled due to disagreements over how Ancelotti's contract with Real Madrid, which runs until 2026, should be resolved.

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Madrid are reportedly not willing to pay out the remainder of Ancelotti’s contract, even if they agree to let him leave at the end of the LaLiga season. Meanwhile, CBF officials are currently in Madrid trying to reach a compromise, but are being careful not to pressure Ancelotti into breaking a verbal agreement he made earlier with Brazil.

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CBF President Ednaldo Rodrigues has set a May deadline to appoint a new coach and, as talks drag on, the federation is reportedly reconsidering Al Hilal coach Jorge Jesus as a backup option to lead Brazil in the June CONMEBOL qualifiers.

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Despite Ancelotti’s success at Madrid — having won three Champions League titles and two LaLiga trophies over two spells — this season has fallen below expectations.

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Madrid were knocked out by Arsenal in the Champions League quarterfinals, lost the Copa del Rey final to Barcelona, and currently trail their rivals in the league by four points with five matches remaining.

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Brazil, meanwhile, have been without a coach since Dorival Júnior was sacked in March after a 4-1 defeat to Argentina in a World Cup qualifier. They are currently fourth in the South American qualifying table and are set to face Ecuador on June 4 and Paraguay on June 9.

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If Ancelotti does leave Madrid in time, the Spanish club would need to appoint a new head coach or an interim manager ahead of their appearance at the Club World Cup this summer.

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If Brazil cannot seal the deal with Ancelotti soon, sources say the CBF may reopen discussions with Jorge Jesus to ensure a coach is in place for the May 26 squad announcement.

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