Rangnick has agreed a six-month deal to manage United until the end of May, before moving into in a consultancy role at the club for an initial two-year period. It is understood Rangnick has also been offered a role at United for next season.
It is understood the 63-year-old rejected an initial contract offer from United but agreed to become the club’s interim manager after receiving new terms and has accepted them.
United announced their intention to hire an interim boss until the end of the season after they parted company with Solskjaer last weekend with Rangnick identified as the leading candidate after an interview process.
Rangnick, currently the head of sports and development at Lokomotiv Moscow, will not be in charge in time for the weekend’s game at Chelsea due to work permit issues.
MEN Sport revealed this week that United had shortlisted the German to take over as interim manager and had made him their preferred choice for the role.
Rangnick left Leipzig last year after a protracted move to AC Milan collapsed and joined Lokomotiv in the summer.
Despite the impending appointment of Rangnick, the club are still very much in pursuit of Paris Saint-Germain manager Mauricio Pochettino in regards to him becoming their next permanent manager at the end of the season.
United had an initial enquiry to appoint Pochettino as their new manager in the mid-season knocked back by the French club earlier this week before pushing ahead with their plans for an interim appointment.
The Argentine is unsettled in Paris and although he played down suggestions of a link with United at his pre-match press conference ahead of the Manchester City game on Tuesday, privately he is understood to be open to an approach from United.
Pochettino was keen to return to Tottenham in the summer only for PSG to stand firm and they have now turned down United’s first approach to try and talk to their manager.