They thought it was all over. It is now, as Sven signs on with England until 2008

It was an image straight out of BBC2's Double Take. The man with probably the most distinctive head in the country captured in a private moment by a long distance lens.

But no, this was not a lookalike Sven Goran Eriksson caught in flagrante with Ulrika Jonsson or comparing underpants with David Beckham. The blurred photograph on the front page of Saturday morning's Sun was the real thing - the England football coach in what he had clearly hoped to have been a secret meeting with Peter Kenyon, chief executive of Chelsea football club. And just in case any Sun readers were in doubt, a large red arrow was pointing at the profile shot of that head.

As soon as the first editions began circulating on Friday night, it was being seen as the beginning of the end of Eriksson's tenure as England coach and he would be leaving for Chelsea after this summer's Euro 2004 competition in Portugal. So began thirty-six hours of fevered national debate with yesterday morning's papers largely coming to the conclusion that "Sven will go to Chelsea".

The Mail on Sunday said Eriksson had met the Chelsea supremo, Roman Abramovich, on 17 March, when he was reportedly told to make up his mind. Crucially for its readers, the MoS said his partner, Nancy Dell'Olio, was in favour, since he would be spending more time in England - where she could keep an eye on him, presumably. The Sunday Mirror said Eriksson had spent Saturday night at a performance of the Russian National Orchestra with Abramovich. The Sunday Telegraph was unequivocal: "Eriksson will quit England job this summer" was its headline.

By 11am yesterday, a beaming Eriksson was again being photographed - this time shaking hands with Mark Palios, chief executive of the Football Association, announcing a new two-year extension to his contract, enabling him to lead England until 2008.

Eriksson, in his usual civilised and precise manner, brushed aside the morning's headlines and gave an intriguing insight into the pressures of his job: "It's always very difficult to understand that the person who has this job, that the man should be a saint, shouldn't earn a lot of money, shouldn't have a private life, and shouldn't listen to other work possibilities. That I find very difficult to understand, but that's the way it is."

Speaking to those largely responsible for his embarrassment, he told reporters: "Sometimes you make me feel like I'm a criminal person. But I don't think that I've done anything criminal." But the press pack's desire for answers remained.

Had the two hours of talks at Kenyon's apartment on Thursday night simply been part of Eriksson's game plan to improve his contract with England? Or had the media's actions stymied his hopes for a £40m, five year deal to give Abramovich the trophies he covets and for which he seems willing to pay almost any price? And does yesterday's announcement really mean Eriksson will remain in post if England do badly in Euro 2004 and the 2006 World Cup?

One thing is certain: although many England fans applaud Eriksson for the team's successes, they will now continue to question his loyalty. "Sneaky Sven" said The Sun, reflecting the view of many fans.

And since last July, when Eriksson was first photographed meeting Abramovich, he has repeatedly denied he was in line for Chelsea. The meeting was simply "social" , said Eriksson and when questioned again last month he said: "There are clubs around Europe phoning and asking, but I always say I am not interested. I'm fed up with people asking about my future. Nothing has changed." Such protestations now ring hollow.

Abramovich is certainly the man who can provide Eriksson with the money he believes he is worth. Eriksson has been quick to seize on any endorsement deals while Ms Dell'Olio is the kind of woman for whom the phrase "high maintenance" might well have been invented.

But the chalice of Chelsea, if golden, might also be poisoned. Abramovich has made it known that winning silverware is not all that matters and what also counts it is the type of football being played. The problem is that he wants all this now.

The second problem facing Eriksson would be gaining the support of fans and players. Claudio Ranieri, the present manager, is backed by supporters incensed by the club's open courting of other contenders. "It's a matter of principle," David Johnstone, the editor of the club's fanzine, said. "Even if Ranieri is not the right man, you can't go around treating people in this way." Similarly, the players have expressed faith in their coach and improved their performances.

As the speculation continued over the weekend, behind the scenes, things were moving. The media were summoned to an FA press conference yesterday morning where elated officials presented Eriksson with the delight of a new Premiership signing. No one dared to suggest this was a mere co-incidence, although Eriksson stressed: "Chelsea have never offered me anything." Kenyon later conceded to 'informal' discussions, but also repeated that no offer was made.

The new arrangements are set to earn Eriksson about £500,000 a year extra on top of his £3m annual salary, which is still less than Abramovich's reported offer. But what if England do badly in Portgual? Maybe then the FA won't be so anxious to stop Eriksson taking the Chelsea rouble.