The Italian ended a 35-year trophy drought by overseeing FA Cup success in 2011 and he topped that by following up with dramatic Premier League success last year.
His record in the Champions League did let him down, however, with two group-stage exits.
Pellegrini said: "I think Roberto did a great job here in Manchester. It is not easy to win the title after 44 years.
"But I think we start now a new cycle, a new style of club, adding to what Roberto has done over the years."