Lothar Matthaus is set to take over as the new Bulgaria coach, the country's football association has announced.

The 49-year-old German FIFA World Cup™-winner is on the verge of agreeing a one-year contract with an option for a further two years to be agreed.

His first competitive match in charge is due to be against Wales - who are searching for a new full-time manager following John Toshack's departure - in Cardiff on 8 October.

"An agreement between Matthaus and the Bulgarian Football Union (BFU) has not yet been signed, but it will be for one year with the option of extending it for another two," a statement on the federation's official website read.

"Lothar Matthaus' team will lead us in the next match against Wales and will live in Bulgaria during his contract."

Matthaus, who made 150 international appearances as a player, takes over from Stanimir Stoilov who resigned the post earlier this month after Bulgaria lost their opening two UEFA EURO 2012 qualifiers to England and Montenegro.

"It was not easy to find a coach in such a short time and I'm glad we did, I hope all of you also support it," the head of the BFU Borislav Mihailov said.

The former Bayern Munich midfielder has previously coached at international level when he failed to guide Hungary to the 2006 FIFA World Cup.

He has also managed domestic clubs Rapid Vienna, Partizan Belgrade and Salzburg while he left his most recent appointment at Israeli side Maccabi Netanya in April last year.