Firoz Kassam has sold Oxford United Football Club.

The U's chairman is believed to have agreed a fee of about £2m with American-based businessman Nick Merry, with the deal expected to be announced later today.

It will mean that Jim Smith, the most successful manager in Oxford United's history, will return to the club to take over as the U's new boss.

The package includes Merry taking on the club's debts, but it is understood at this stage, just the football club has been sold, with the Kassam Stadium set to be sold in the summer.

Negotiations have been taking place for more than a month with Kassam, and the deal has been off and on many times.

But it was concluded yesterday, and Oxford United are set to hold a press conference later today to announce the new set-up.

Neither Smith nor Merry was at United's League Two game against Bury at Gigg Lane last night because loose ends in the deal still needed to be tied up.

Smith, 65, who lives in Woodstock and who led Oxford to the third division and second division championships in successive seasons in the mid-80s, is understood to be bringing in his own assistant.

That could mean Darren Patterson returning to either reserve team manager or his old job of youth team boss.

He was last week appointed manager until the end of next season by new directors Bill Smith and Brendon Cross, who had been appointed by Kassam.

It is not known at this stage whether either Bill Smith or Cross will have any involvement in the club under Merry.

Jim Smith is expected to announce some immediate new signings to join United's relegation fight.

Among names mentioned are former Scotland and Nottingham Forest midfielder Scot Gemmill and journeyman striker Steve Claridge.

Ex-United midfielder Jim Magilton is not thought to be involved in a move from Ipswich.

Smith, one of the most respected managers in football and known throughout the game as the Bald Eagle, managed Oxford United from March 1982 until June 1985.

Under him, the side won 89 of their 167 games, drew 36 and lost just 42 as he guided them into the first division (top flight) for the first time.

He had previously been in charge at Colchester, Blackburn and Birmingham and, after leaving the Manor Ground following disagreements with chairman Robert Maxwell, he managed QPR.

He was then boss of Newcastle United and Derby before teaming up with Harry Redknapp for spells at Portsmouth and Southampton.

He admitted last night that he had had several offers to get back into football, but had stayed loyal to his friend Nick Merry, a former Oxford United youth team player.

"It's the longest I've been out of football but I've been waiting for the right one," he said. "I obviously have a very special affection for Oxford United Football Club."