Hiddink replaces Gadzhi Gadzhiyev, who was fired earlier this year.
He will earn a reported 8 million euros at the Russian side, who train in Moscow but play in the war torn region of Makhachkala.
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Summer 2016 is set to be a very exciting time for football fans, as this is when the long awaited Euro 2016 tournament kicks off.
Since Guus Hiddink arrived at the helm, Chelsea have improved considerably after a tricky start to the campaign.
