Paatelainen has vacated the manager's post at Easter Road
Hibernian manager Mixu Paatelainen has left the Easter Road club by mutual consent after 16 months in the post.
He becomes the third Scottish Premier League manager to leave his post this week after Celtic's Gordon Strachan and Aberdeen's Jimmy Calderwood.
BBC Scotland believes one of the reasons for Paatelainen's departure was the board's proposal to reduce the playing budget for next season.
Former Hibs defender John Hughes is among those being tipped to take over.
Now the manager at Scottish Cup finalists Falkirk, Hughes played for Hibs on 72 occasions from 1996-2000, having signed from Celtic.
Hibernian finished the season on a relative high. They finished sixth in the table, and in May beat city rivals Hearts 1-0 at Tynecastle before registering impressive draws with Rangers and Celtic at Easter Road.
Paatelainen's final game in charge was the 2-1 defeat at Pittodrie on 24 May.
The Finn came under pressure from sections of the Easter Road support throughout the season.
A 4-0 aggregate defeat by IF Elfsborg in the Intertoto Cup preceded defeats by First Division Morton and Hearts in the Co-operative Insurance Cup and Scottish Cup respectively, while inconsistency meant they finished six points off the pace to qualify for a European place.
A statement by Paatelainen on the club's official website says: "I have thoroughly enjoyed my time as manager.
"We have travelled a journey together and the club will always hold a special place in my heart.
"However, there comes a time when a change of direction is best for both parties.
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