Steven Gerrard believes extending Jurgen Klopp's contract is Liverpool's "most important signing for many years to come".
Reds boss Klopp signed a two-year extension to his deal at Anfield on Thursday that will keep him tied to the club until 2026.
Gerrard, who is now manager of Aston Villa, played almost his entire career at Liverpool, making 710 appearances, scoring 186 goals and winning two FA Cups, three League Cups, a UEFA Cup and a Champions League with his boyhood club.
Speaking at a media conference ahead of Villa's Premier League match with Norwich City, Gerrard said Klopp's new deal was good news for all Liverpool fans.
"You can tell by the smile," he said when asked what he thought. "Listen, all the Liverpool fans worldwide are absolutely delighted with the news.
"Congratulations to Jurgen and his staff, and I think it'll be Liverpool's most important signing for many years to come. That's how highly we all think of him. [It is] terrific news for Liverpool Football Club."
Gerrard has inevitably been linked with an eventual move to manage his former club, having spent a brief spell in charge of Liverpool's under-18 side before moving to Rangers, where he won the club's first Scottish Premiership title in 10 years.
He became manager of Villa in November and has overseen 22 matches so far in all competitions, winning eight, drawing three and losing 11.
Liverpool are still in the hunt for an unprecedented quadruple this season, having already won the EFL Cup. Klopp's men have an FA Cup final against Chelsea to come, are 2-0 ahead after the first leg of their Champions League semi-final with Villarreal and sit just a point behind Manchester City at the top of the Premier League with five games remaining, with both scheduled to play Villa in the run-in.
"I think he certainly deserves it for the way he's performed," Gerrard continued. "I think the [Liverpool] fans have been craving that signing for some time, and he's built a world-class team, and I think they're on the cusp of something really special.
"We can have an influence in that, so that'll be interesting when [Liverpool] come to Villa Park. We wish them well outside of that fixture, and I think it's totally deserved and it's fantastic news for Liverpool Football Club. I think it's the most important signing for a very long time at the club."