Switzerland's Lucien Favre was named coach of Ligue 1 outfit Nice on Tuesday after the resignation of the highly-respected Claude Puel.

Favre, 58, has been out of work since being sacked by Bundesliga club Borussia Moenchengladbach in September, but was set to sign a three-year contract with Nice, according to sources.

The former Swiss international midfielder, known for encouraging attacking football, led Moenchengladbach into the Champions League but paid the price for a dreadful start of the season.

The outgoing Puel, 54, had previously coached Lyon and famously took Monaco to the 2004 Champions League final, while this season he gave a free role to France forward Hatem Ben Arfa as the side finished fourth in France.

"We came to a common decision not to continue our adventure," a statement said on Nice's website on the end of a four-year collaboration with Puel.

The move could well be taken badly by the club's fans, who are also set to lose their star player Ben Arfa in June after their highest league finish for 30 years.

As well as his run to the Champions League and French League victory at Monaco, Puel also led Lyon to the Champions League semi-final in 2010, and guided Lille to a 2004 Intertoto Cup and a French league runners up spot in 2005.