Watford Chairman Jimmy Russo rejected Reading's initial approach.
"Following speculation over the Reading vacancy I had spoken to Brendan only last week and he had assured me that he was 100 per cent committed to Watford and our plan for the future," Russo said. "But once Brendan had confirmed his desire to discuss the opportunity and Reading had met a contractual compensation figure, we were powerless to prevent him doing so.
"I then spent up until Monday evening negotiating with Reading a vastly improved compensation package, starting at £500,000 and potentially rising to £1million.
"We also had a frank and open conversation with the manager on Monday afternoon to further understand his position. It was at this stage he strongly reinforced his desire to talk to Reading."
Rodgers then met with Reading on Tuesday and it's now a done deal bar Reading's final confirmation.
After leaving Vicarage Rd Rodgers said "I'm very proud of my work at Watford in what has been a short period.
"My decision to come to Watford in November has proved to be the right one. It was a difficult period in the club's history but we became one club after all the turmoil and for that I thank the supporters.
"We are now on different journeys but I wish the club every success and I'm proud to be forever connected in the history of a great club."