According to the Egyptian FA, Shehata agreed to terminate his contract by mutual consent following a meeting with FA chairman Samir Zaher.
The decision was made after Shehata failed to take Egypt to the 2012 Nations Cup for the first time in the history of the seven-time African Champions.
Shehata guided Egypt to three back-to-back Africa Cup of Nations titles in 2006, 2008 and 2010.
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