Chris Hughton has been appointed manager of Premier League team Norwich City, his previous club Birmingham City said yesterday.
Birmingham, who play in the second-tier Championship, said in a statement on their website that compensation had been agreed to take Hughton and three backroom staff to Norwich.
"The departing Blues boss will take over as the Canaries' new manager and will be followed by assistant manager Colin Calderwood, first team coach Paul Trollope and chief scout Ewan Chester," they said.
Norwich finished 12th last season after returning to the top flight under Lambert, while Birmingham missed promotion to the Premier League after losing a playoff semi-final.
Birmingham had, reluctantly, granted permission for Hughton to talk to Norwich on Wednesday.
"We'd like to thank Chris and his team for their efforts over the last 12 months and they leave with our best wishes," said Birmingham's acting chairman Peter Pannu.
Meanwhile, the agent of Ralf Rangnick told Sport Bild that the former Hoffenheim and Schalke coach has rejected the chance to manage English Premier League club West Bromwich Albion.
"After a long period of reflection, Ralf Rangnick has decided not to accept the offer from West Brom," Oliver Mintzfeld was quoted as saying on Sport Bild's website.
Mintzfeld had previously admitted last weekend that talks had taken place between the two parties.
Rangnick has never hidden his desire to one day coach in England, where he spent time as a student and also played non-league football for Sussex club Southwick.
The 53-year-old Rangnick stepped down as coach of Schalke six games into the 2011/12 season, explaining that he no longer had "the energy levels required to aid the development of the team or the club."
He previously led village club Hoffenheim to consecutive promotions before establishing them as a force in the Bundesliga.