The 65-year-old coach, who is set to leave Real Madrid this summer, has already told the Brazilian football federation that he won’t be taking the Selecao bench, said Marca.
The Saudis have offered him 50 million euros net a season, said the Spanish daily.
ESPN Brazil said Tuesday that Ancelotti was set to sign for Brazil on May 26, two days after he leaves Real Madrid.
The plan was for the former Parma, Juventus, Milan, Chelsea, PSG, Bayern Munich, Napoli and Everton boss to take charge of the Selecao for World Cup qualifiers against Ecuador and Paraguay on June 3 and 8.
Reggiolo-born Ancelotti, 65, a former Parma, Roma and Milan midfielder, has won the UEFA Champions League five times, a record for a manager, and is the only manager to take part in six Champions League finals.
Ancelotti is also the only manager to win league titles in all of Europe’s top five leagues.
He has been closely linked to the Brazil job since Real were knocked out of the Champions League by Arsenal in the quarterfinals.
ANSA