Gaitan deal on even after United denial

Reports from Portugal confirm talks are being held over £29m signing of Argentinian midfielder

Portugal's conviction that Manchester United are seeking a preliminary agreement on price for Benfica's Argentine midfielder Nicolas Gaitan were strengthened yesterday when the weekly sports paper, which has closest and privileged access to Benfica, led with the story.

United do not comment on transfer speculation, though there were strong assertions from Manchester that the club do not have any interest in the player. Yet in Portugal, where there has been widespread surprise that Benfica have not even denied the story – first published in the The Independent at the weekend – there is widely believed to be a preliminary agreement on the table. Record, a sports publication considered to be the best authority on Benfica, asserted that the story is valid. Its own account, which appears to be separately sourced, tallied almost entirely with reports so far – the paper's only doubt being whether discussions on a preliminary deal are continuing or have concluded with a £29.3m valuation. "Gaitan – the end of the era; business to be completed at the end of the season," read the paper's headline.

Though Portuguese sources suggest that Jorge Mendes, the agent who has helped to take Cristiano Ronaldo, Nani, Anderson and David de Gea to Old Trafford over the past eight years, has been working on securing a deal which could value the player at closer to £35m dependent on his performances in the second half of the season, it is becoming increasingly clear that such an arrangement would not protect the buying club from a counter-offer. If another side comes in with a higher bid, the initial bidder would have to match it or lose out.

United, who travel to Fulham tonight with faint hopes of leading the Premier League at Christmas being contingent on a win coinciding with Manchester City's first home defeat since 20 December last year, appear to have a strong hold on Dimitar Berbatov's future – despite the fact that as of 1 January he can speak to other clubs about a move at the end of the season.

The Bulgarian striker's right to speak to suitors is triggered by him entering the final six months if his contract. But United's sway over him is the result of a "one-way" option in his contract which enables them to extend it by a year at any time until it expires. Berbatov has no say in whether United might invoke it. It is unclear whether United have yet taken that step. If the club have not, it seems that Berbatov could agree next month to join another club – only for United to insist at a later date that he remains theirs for another year.

Tonight takes Chris Smalling back to the club which gave him his big break. "I see my time there as a big two years" he said. "My first year was about finding my feet and the second was about showcasing what I can do. Without [then manager] Roy Hodgson giving me my chance there I wouldn't be here so it's a time I look upon fondly. It'll be nice to go back and see a few of the players and play back at the Cottage.

"The players always look forward to this time of year with plenty of the games. We're used to the demands and it's a big opportunity to pick up a lot of points – we want to get maximum points. Christmas can be a hindrance on some and can sometimes make or break you in terms of kicking on, but this is a period where we really need to kick on and show everybody we mean business."