Borussia Dortmund have announced the appointment of Lucien Favre as their new head coach on a two-year deal.

Favre stepped down as Nice coach last week amid speculation linking him with the Dortmund job.

The 60-year-old Swiss has previously coached Hertha BSC and Borussia Monchengladbach in the Bundesliga, helping the former to fourth place in 2008/09 and saving the latter from relegation in 2011/12.

“Coaching Borussia Dortmund is an exciting task that I’m delighted to take on,” Favre said on the Dortmund website.

“I’d like to thank the directors for the faith they’ve shown in me. We’ll now work together on the new team.

“BVB is one of the most interesting clubs in Europe and I’m looking forward to returning to the Bundesliga, which I know extremely well and always kept an eye on during my two years in Nice.”

Favre will replace Peter Stoger, who signed a short-term deal as Dortmund coach in December following the sacking of Peter Bosz.

Stoger helped Dortmund recover from eighth place to qualify for the Champions League as they finished in fourth, beating Bayer Leverkusen to Europe’s premier competition on goal difference.

However, the Dortmund hierarchy were keen to go in a new direction this summer.

“The appointment of Lucien Favre as coach is an important aspect of our fresh sporting start this summer,” said sporting director Michael Zorc.

“He’s highly regarded by us for the technical qualities that he demonstrated in impressive style many times throughout his spells with Hertha BSC and Monchengladbach in the Bundesliga, and more recently with Nice.”