The Norwegian boss has extended his stay until 2024 with an option for another year.
The new deal will see the Norwegian boss earn around 25m pounds as the Red Devils hierarchy are clearly happy with his progress.
Solskjaer took over at Man Utd in 2019 after serving as the club’s makeshift boss for three months following Jose Mourinho’s departure.
Although he couldn’t win any trophies for which he is still receiving criticism, it will not take away the fact that Solskjaer steadied the ship at Old Trafford.
Last season turned out to be the most promising one of his tenure, yet the Red Devils ended as runners-up in the Premier League and Europa League.
Man Utd chief Ed Woodward is delighted with the club’s trajectory under Solskjaer, heaping praises on the Norwegian’s leadership.
Ed Woodward said: “We are more confident than ever that, under Ole’s leadership, we are heading in the right direction. Ole and his staff have worked tirelessly, putting the foundations in place for long-term success on the pitch.
“The results of that have become increasingly visible over the past two seasons, and we are all looking forward to seeing this exciting team develop further in the years ahead.
“What is especially pleasing is the way this progress has been achieved with a blend of young, homegrown talent and top-class recruits, playing attacking football in the best traditions of Manchester United.”
Solskjaer also expressed his gratitude after signing the new deal and ensured the Man Utd players are hungry for success.
“Everyone knows the feeling I have for this club.”
“It is an exciting time for Manchester United. We have built a squad with a good balance of youth and experienced players that are hungry for success.
“I have a fantastic coaching team around me, and we are all ready to take that next step on our journey. Manchester United wants to be winning the biggest and best trophies, and that’s what we are all striving for. We have improved, both on and off the pitch, and that will continue over the coming seasons.”
Having signed Jadon Sanho in one of the most exciting transfers this summer and backed by the club in the transfer market for further signings, Solskjaer will look to get the Red Devils back to their heydays next season.