MADRID (Reuters) -- Europa League winners Atletico Madrid have extended the contract of coach Quique Sanchez Flores until the end of next season and agreed to sign midfielder Fran Merida from Arsenal, the La Liga club said on Tuesday.

Atletico sacked Abel Resino in October after a poor start to its campaign and Sanchez Flores, a former Real Madrid and Valencia defender who was also capped by Spain, was hired until the end of the season to try to stop the rot.

He led it to a Europa League triumph when it beat English Premier League side Fulham 2-1 in the final in Hamburg, and also a runners-up spot in the King's Cup.

In previous coaching jobs, he guided Getafe to 13th place in its first ever top-flight campaign in the 2004/05 season before taking the helm at Valencia, leading his former club to third and fourth place finishes over the next two terms.

He was sacked three months into the 2007/08 season after a run of poor results and moved to Portuguese club Benfica last season, steering them to third place in the league before stepping down.

The 20-year-old midfielder Merida, who has represented Spain at youth level and scored a memorable goal against Liverpool in the League Cup last October, is out of contract with Arsenal at the end of June, Atletico said on its website (www.clubatleticodemadrid.com). He will join on a four-year deal.

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