The seven-time European champions are lying seventh in Serie A after a goalless draw against Torino on Sunday.
“AC Milan announces the exemption of Vincenzo Montella from the post of coach of the first team,” the club said in a statement.
“Montella is the most appreciated thanks to the work done so far with her staff for commitment, seriousness and professional fairness.
“The technical management of the team is entrusted to Gennaro Gattuso, who leaves his post as Primavera coach, and to whom AC Milan offers the most warmest wishes for good work.”
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