Former Liverpool and Bayern Munich defender Markus Babbel has been appointed the head coach of the Western Sydney Wanderers on a three-year deal.

Babbel, 45, was announced as the A-League club's new boss on Saturday, having left his post at Swiss side Luzern in January.

The former Germany international – who won the Bundesliga, UEFA Cup, FA Cup and Euro 1996 as a player – becomes the Wanderers' third permanent coach, replacing the sacked Josep Gombau.

"Today we have made a statement about our future and I am very proud to announce Markus Babbel as our new head coach," Wanderers chairman Paul Lederer said.

"In the next 18 months we will have our new training facility finished, our new stadium open and our club ready to take another giant [step].

"Having a coach like Markus involved with this club will make us a force in this league as we strive to win trophies, return to the AFC Champions League and make a statement not only in Australia but internationally as a football club."

The job is Babbel's fifth, following on from stints at Stuttgart, Hertha Berlin, Hoffenheim and Luzern.

Western Sydney – A-League premiers in 2013 and AFC Champions League winners a year later – finished in a disappointing seventh last season.