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Dalglish returned to management in October 1991, at Second Division Blackburn Rovers.
By the turn of 1992 they were top of the Second Division, and then suffered a dip in form before recovering to qualify for the playoffs, during which Dalglish led Blackburn into the new Premier League by beating Leicester City 1 – 0 in the Second Division Play-off final at Wembley.
The resulting promotion meant that Blackburn were back in the top flight of English football for the first time since 1966. In the 1992 close season, Dalglish signed Southampton's Alan Shearer for a British record fee of £ 3. 5 million.
Despite a serious injury which ruled Shearer out for half the season, Dalglish achieved fourth position with the team in the first year of the new Premier League.
The following year, Dalglish failed in an attempt to sign Roy Keane.
Blackburn finished two positions higher the following season, as runners-up to Manchester United.
By this time, Dalglish had added England internationals Tim Flowers and David Batty to his squad.

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