MARTIN O'NEILL'S 16-month reign as manager of Sunderland Football Club has come to an end after owner Ellis Short decided to replace the Northern Irishman on Saturday night.

In a club statement issued from the Stadium of Light, where the Black Cats extended their winless run to eight games with a defeat to Manchester United earlier in the day, it was confirmed that O'Neill had left his job after 66 matches in charge.

Sunderland, whose Premier League future hangs in the balance after sliding to within a point of the bottom three ahead of the final seven matches of the season, are already working on a replacement for next Sunday's trip to Chelsea.

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The statement read: "Sunderland AFC has announced that it has parted company with manager Martin O’Neill this evening.

"The club would like to place on record its thanks to Martin and wishes him well for the future. An announcement will be made in the coming days regarding a successor."

On Friday O'Neill insisted he was still the right man for the job and he still had the backing of his players, who have regularly suggested his man-management would turn the club around.

But Short became increasingly frustrated with the lack of return on his investment, having given O'Neill permission to spend more than £30m this season on permanent buys Steven Fletcher, Adam Johnson, Alfred N'Diaye and Danny Graham.

Now Short will be working on a list of contenders. Only last week Everton's David Moyes was surprisingly linked with the role, while Wigan's Roberto Martinez, ex-Manchester United striker Ole Gunnar Solskjaer, Paolo di Canio and Brighton manager Gus Poyet are all likely to be linked. Former Chelsea boss Roberto di Matteo is the early favourite.

There is a long line of names looking to get back in to the game, with the likes of Mark Hughes, Graeme Souness and Steve McClaren sure to be interested. But Short is likely to consider all the options in front of him.

The Irish-American businessman will be keen to make the right appointment after seeing his appointments of Steve Bruce and O'Neill come up short.

O'Neill took over in December 2011 signalling an intention to make the club he supported as a boy in to a Premier League force.

But despite an encouraging start which saw Sunderland climb away from relegation trouble, the 61-year-old's tenure quickly descended in to frustration.

A disappointing FA Cup quarter-final defeat to Everton towards the back end of last season was seen as a missed opportunity and, despite the August acquistions of Fletcher and Johnson, this campaign has never taken off.

And O'Neill's time in charge ends with the 25th defeat of his 66-match reign, winning just 21 of those, at the Stadium of Light today against Manchester United.

Now whoever comes in will have the task of reviving the team's fortunes quickly, knowing that remaining dates with Chelsea, Newcastle, Everton, Aston Villa, Stoke, Southampton and Spurs will determine if the club drop in to the Championship in May.

Editor of Seventy3 Fanzine Malcolm Robinson said: "The fans will be quite happy that O'Neill has gone but it is just the timing that is surprising.

"We can't put our finger on what has been going on. 

"Ideally I would like to see di Matteo come up to Sunderland. That would be a big call for him. Or maybe Peter Reid, he has been in before and could get the squad motivated quickly.

"I was quite confident O'Neill would have kept us up and then regrouped in the summer. The next few games are going to be hard and the next three games - Villa away, Stoke and Southampton at home - are going to be crucial."