Three years after being forced out as Australian Rugby Union supremo, John O'Neill is riding back as the embattled code's white knight.

O'Neill will be announced as the ARU's chief executive on Thursday morning after signing a long-term deal.

He will start what's believed to be a five-year term, taking him past the 2011 World Cup in New Zealand, within weeks.

O'Neill's swift return comes just a month after he ruled himself out of contention for the post left vacant by the resignation of his 2004 successor, Gary Flowers.

But it's understood the push from key stakeholders and sponsors for the man widely regarded as Australia's best sports administrator has pressured the ARU board to invite him back.

While there has been speculation O'Neill wanted to assume an executive chairman's role, giving him extra power, an ARU source said he would return in his former role as chief executive.

O'Neill took the XV-man code to a high watermark during his eight-year reign from 1996 to 2004 when the Wallabies enjoyed a golden era highlighted by the 1999 World Cup triumph.

After being denied a three-year extension as boss after successfully hosting the 2003 World Cup, the departing administrator was immediately snapped up to lead Australian soccer.

Former Wallabies coach Eddie Jones welcomed the appointment, praising O'Neill as the best man to turn around the sport after a forgettable past two years.

"There's no better person in Australia at the moment to do that for Australian rugby," said Jones, Australian coach from 2001-05.

"What he will do is bring a very, very strong direction to the organisation which everyone in Australian rugby agrees is what we need."

O'Neill, supported by high-profile figures such as John Eales and Simon Poidevin, himself assessed the code was in "deep shit" when speaking at a club rugby lunch in Sydney last Friday.

"There are a whole lot of issues that I have seen from afar in rugby in the last couple of years that are very much about dysfunctionality," he said.

In ranking the four football codes, O'Neill believed rugby had slipped from No.2 behind AFL in 2003 to No.4 at present.

Jones had no hesitation in rating O'Neill's challenge far tougher than what he faced in cleaning up soccer's mess in 2004.

"In soccer there was a clear mandate," he said.

"There was no board, there was a chairman and a CEO so by the very structure of the organisation he was in control.

"Rugby is not like that so the CEO has to manage up, manage down and manage around so it's a much more complicated and complex situation but the good thing about John is that's he's had that previous experience."

A polarising figure in the game, O'Neill return comes less than two months after ARU director Terry Jackman was axed from the nine-man board after allegedly undermining Flowers to install the 55-year-old.

The announcement has been endorsed after the ARU employed a search company and formed a board sub-committee containing General Peter Cosgrove, Rick Lee and Bob Dalziel.

It's understood O'Neill always harboured a desire to regain the reins in rugby but wasn't keen to jump through the hoops of a recruitment process.

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