Liverpool are closing in on a £27m deal to sign Thiago Alcantara from Bayern Munich.

The Reds are in advanced negotiations with the Bundesliga club over a deal for the Spain midfielder.

Both sides are confident a deal can be reached swiftly with Bayern expected to receive £20m up front and a further £5m in bonuses.

Liverpool have been heavily linked with Thiago since it became clear he would not sign a new contract at the Allianz Arena.

Thiago, 29, agreed a new deal with the European champions back in May but then decided against signing it.

The midfielder is keen for a new challenge and wants to work with Jurgen Klopp.

Thiago has yet to agree personal terms but they are understood to be of no issue with the player interested in moving to Anfield.

The Spaniard is expected to put pen to paper on a four-year deal and wear the number six shirt.

Manchester United have also had an interest in Thiago this summer but did not make a move.

It is not clear if United will now contact Bayern but they would be facing a battle to convince the club and player now Liverpool have finally made their move.

Liverpool's stance this summer is that a move for Thiago would only be made if a midfielder departed the club.

There has been a feeling because of the coronavirus pandemic that the club would need to sell players to ensure revenue was also incoming if they were to spend big.

But it is understood their move for Thiago is not based on any player departing despite interest from Barcelona in Gini Wijnaldum.

Get the latest transfer news straight into your inbox!

Want to be on the ball with Jadon Sancho to Manchester United updates? Or perhaps you're a Chelsea fan wondering who on earth could join next?

Well then sign up for the brilliant new Daily Star Sport email newsletter!

From the latest transfer news to the agenda-setting stories, get it all in your email inbox.

How do you sign up?

It only takes a matter of seconds.

Simply type your email address into the box at the top of this article and hit 'subscribe'.

And that's it, job done. You'll receive an email with all of the top news stories every single morning.

You can find out more information on our email newsletter on this link here.

Bayern are keen to sort Thiago's future out before the start of the Bundesliga season tomorrow night when they host Schalke.

That may have forced Liverpool into making a move for the midfielder now.

Bayern initially wanted £30m for the Spain international but it appears they have slightly lowered their estimation.