It means the Glasgow-born boss will remain at Turf Moor until 2013 after leading the club into the top flight via a play-off victory against Sheffield United.

Coyle moved south from St Johnstone two years ago and his brand of flowing football won a lot of neutral support last season - and the unqualified backing of the board.

Operational director Brendan Flood said: "We have rediscovered why Burnley does well. We need people who are hard working, we need a good attitude - we do not want any prima donnas.

"Owen is from a good, working-class background. He identifies with the fans. He makes the fans feel proud of the club and he feels privileged to be the manager.

"We gave him a great opportunity, he has taken it with both hands and that has given him a chance to perform in the Premier League.

"We expect Owen to go on and show he can become a top-six manager. I think he will be."

Flood believes Coyle's heart lies firmly with Burnley after Celtic, who came calling in the wake of the Wembley victory, were rebuffed.

"Owen had the sternest test of his commitment to the club as he was celebrating. Celtic's approach was within an hour of the win, "said Flood.

"It could not have been any tougher for him as they are from his home town and you have to be concerned when you are in our position.

"I knew it was going to be tempting. I also know he is genuine. He is a loyal guy and there had been lots of discussions about his contract before the match. It probably just needed the pink ribbon on it afterwards.

"The relationship we have between ourselves and Owen is one of the main reasons he is still here. There is a mutual loyalty."

Coyle admitted the speculation was an unwanted distraction.

He said: "It did not help and maybe took a little bit of edge of things after our Wembley victory.

"We thoroughly enjoyed what we did. We knew how hard we worked to achieve our success.

"I was thinking about remaining in the Premier League and taking the club on, that was all. What we have to do now is move on and make sure we are ready for an exciting challenge."

Coyle revealed he had been negotiating with the board since the start of the year about a new deal.

"This has been going on for the best part of six months," he said. "We just had to ease off a bit because of our schedule at the end of the season.

"It was always going to come to fruition, it was always going to happen. We had agreed in principle what we were doing and I am glad it has been settled and we can now move on."