ESPN's Adam Schefter says Gruden's return will be made official in a Tuesday press conference, and that he's be handed the coaching keys to the franchise for the next decade.
The Tampa Bay Buccaneers were originally reported as the most likely destination for Gruden, but it stands to reason that things changed when Davis's outrageously lucrative offer was put on the table.
Under the new deal with the Raiders, Gruden's coordinators will receive four-year contracts, according to NFL Network's Ian Rapoport.
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ESPN reported Saturday that Raiders owner Mark Davis was prepared to pursue Gruden with a strong offer that could include an ownership stake in the team, which would have to be approved by National Football League owners. He was sacked by the Buccaneers following the 2008 season and has served as a color coordinator for ESPN's "Monday Night Football" ever since.
After a season-ending loss to the Los Angeles Chargers, owner Mark Davis fired Del Rio and seized the opportunity to bring back Gruden, who was also contacted when the Raiders hired Dennis Allen in 2012 and Del Rio in 2014. He was 2-2 in the post-season, losing in the AFC title game following the 2000 season and the divisional round in 2001.
The Raiders have not identified their candidates for the head-coaching job.