Former All Blacks back Luke McAlister is to return home from England in a tremendous boost for New Zealand rugby.

McAlister announced on Friday he has re-signed with the New Zealand Rugby Union (NZRU) until 2012, at a crucial time as the country's stock of playmaking depth is thinning.

The 25-year-old matchwinner joined the post-World Cup exodus at the end of 2007, signing a two-year contract with English club Sale.

He will return complete his contract at the end of the English Premiership season in May.

Under current NZRU stipulations he would be ineligible to be selected immediately for the All Blacks as players must first play a season of Super 14 or Air NZ Cup rugby.

However, All Blacks coach Graham Henry this week raised the prospect of a dispensation in the case of McAlister, when speculation was raised that he may return.

New Zealand's options at first and second five-eighth are slim, particularly with incumbent No 10 Daniel Carter sidelined for at least six months with a ruptured Achilles tendon injury.

McAlister said in a statement he was looking forward to coming home.

"The simple reason why I am leaving England and heading home is because I want to be closer to my family who are very important to me," he said.

"The fact that I can continue my rugby career as well back in New Zealand is obviously fantastic as well and I appreciate being given the opportunity, but family comes first."

McAlister is currently recovering from a knee operation this month and is expected to be able to see out his Sale contract from the middle of next month.

He said he felt he had developed as both a person and rugby player in England and hoped to leave the club, who are currently second in the English premiership, on a high.

"We have a chance of having a crack at the top four and hopefully we can give the local fans, who have been great to me, a great end to the season."

NZRU chief Steve Tew said negotiations with McAlister had stepped up over the last two weeks and the deal had only been finalised in the last day.

"This is very good news coming on the back of yesterday's announcement that we have re-signed (Chiefs halfback) Brendon Leonard, (Crusaders halfback) Andy Ellis and (Crusaders utility back) Stephen Brett.

"As all New Zealand and English rugby fans know, Luke is an incredibly talented rugby player and we are delighted that he has chosen to return home."

He is yet to decide on his provincial or Super 14 future and would discuss that on his return to New Zealand.

McAlister scored 120 points in 22 tests after the third test against the British and Irish Lions at Auckland in 2005.

His last act for the All Blacks was a long-range dropped goal attempt in their 2007 World Cup quarterfinal loss to France in Cardiff.

McAlister was a key figure in that game, making a string of early breaks and setting up New Zealand's first try. However, he was sent to the sin bin for an innocuous foul early in the second half, handing momentum to the French.

A former world age grade Player of the Year, McAlister made his debut for North Harbour as a teenager in 2002 while his first Blues start was two years later.

It is widely regarded he left New Zealand without fulfilling his potential.

At the time of leaving he cited the desire for a new experience rather than money as his motivation.

He chose Sale as he grew up in North England, where his father Charlie played rugby league for Oldham, Castleford and Sheffield.

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