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Sport24 reported earlier on the rumours circulating that Papic and Chippa United were set to part ways.
Read: Papic to leave Chippa?
Papic was appointed as Chippa coach in June, and after claiming four points from five games in the Premiership the club decided another change was needed.
"We emphasise that the parties have agreed to part ways mutually due to the club’s commitment to stakeholders to appoint a technical director during this season as part of its bid to be competitive," said the statement.
While the club wished Papic well in his future, it said it was the coach's choice to resign.
"The coach, who was not in agreement with the above-mentioned decision, did not wish to interfere in the arrangements of the club and rather chose to resign."
The resignation means Chippa will now be looking to hire their ninth different coach in just over two years.
Breaking News: Chippa United Football Club and Coach Kostadin Papic have agreed to part ways on confidential terms.
— Official PSL (@OfficialPSL) September 3, 2014
