The England international was in Barcelona, yesterday, having talks with the Spanish club, who are offering a six-year contract worth more than pounds 30,000 a week. This would at least double the player's current wages.
The move would be the second most expensive transfer involving an English club, following Alan Shearer's pounds 15m transfer from Blackburn to Newcastle last year.
Barcelona have plenty of money available to spend on players following the departure this summer of their Brazilian international, Ronaldo, to Internazionale, who have had to pay pounds 18m simply to buy out the player's contract and have yet to agree a transfer fee. The Ronaldo deal is already a world record.
The Spanish club are keen to complete the transfer of McManaman by midnight tonight, which is the deadline for registering players to play in this season's European Champions' League. He has been watched in Liverpool's first two games of the season by Bobby Robson, the former England manager who is now general manager of Barcelona.
McManaman, aged 25, has been with Liverpool since leaving school. He has established himself as one of the English game's greatest creative talents, although there is a feeling that he has not quite realised his undoubtedly huge potential this year.
It is understood that Roy Evans, the Liverpool manager, has not opposed the sale of McManaman. The pounds 12m will be available for him to spend on new players and last night the club were already lining up a pounds 3m deal to recruit the Internazionale central defender, Massimo Paganin.
Reports, page 24