Sky Sports sources understand Stewart Downing would prefer to join Liverpool, despite interest from Arsenal, and the deal could be finalized on Monday.
The Aston Villa winger was the subject of a £15million bid from Liverpool on Wednesday, but the offer was immediately rejected by Villa Park owner Randy Lerner.
Arsene Wenger's Arsenal, who could lose Samir Nasri and Cesc Fabregas this summer, is thought to have attempted to hijack their Premier League rivals with an £18million bid.
But England winger Downing has set his mind on a move to Anfield and Liverpool are negotiating a price to buy a player who has two years remaining on his current contract.
Having already lost Ashley Young to Manchester United, new Villa manager Alex McLeish hopes the former Middlesbrough star will stay and the club is under no pressure to sell.
It had been reported, with Arsenal demonstrating their interest, Liverpool had lined up Wigan's Charles N'Zogbia as solution to their search for creativity in wide areas.
The fact Liverpool director of football Damien Comolli and manager Kenny Dalglish have travelled to the Far East for a pre-season tour was also thought to indicate there was no imminent transfer activity.
But Sky Sports sources understand a deal for Downing could be finalized in the early stages of next week.
It has been questioned whether the soon-to-be-27-year-old Downing meets the criteria for young talent sought by Liverpool, which has already resulted in the signings of Jordan Henderson and Charlie Adam.
But Dalglish wants quality in wide areas and Downing's crossing ability is viewed as a vital factor in the short-term target to return the club to the top four of the Premier League.
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