Graham Arnold to stay at Central Coast Mariners after knocking back Sydney FC post - report

Sydney FC must turn to Plan B for their new coach, after Graham Arnold stunned the Sky Blues by knocking them back to stay at the helm of the Central Coast Mariners.

Sydney officials had believed they had their man and were shocked to learn on Monday that the former Socceroos boss had elected to stay at Bluetongue Stadium.

It is believed Arnold may have been swayed by a late increase in his Mariners offer instigated through a third party.

Arnold said he had been "flattered" by Sydney's interest, but had simply found it too tough to leave the Mariners.

"Two years ago I signed a three-year contract with the Mariners, and I have decided to see that three year term out because of the loyalty and respect I have for the players, the chairman, the staff and all the supporters," he said via a Mariners statement.

"We had a fantastic season and it is a big incentive to compete in the AFC Champions League again next year.

Sources told Sportal Arnold had been "very, very close to accepting the Sydney offer" before ultimately declining: "He just feels very close to the players and the people on the Central Coast and feels there is some unfinished business."

It is big news to the Mariners ahead of a crucial AFC Champions League trip to Japan on May 15 - and a devastating blow to Sydney's hopes of returning to the top of the league next season.

"Already my main focus is on recruitment for next season but also next week against Nagoya [Grampus] in Japan," Arnold said.

"It's been a tough decision and I am hugely flattered by the interest I received from Sydney FC.

"I am very grateful to Gary Cole from Sydney who has been extremely professional, understanding and respectful throughout this process."

Sydney will go back into the coaching marketplace and may again look overseas for Vitezslav Lavicka's replacement.