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The Northern Irishman is set to replace Kenny Dalglish at Anfield after the Reds' owners agreed a compensation package with Swansea City.

UPDATED: Wednesday, 3:26 p.m. ET

Brendan Rodgers is on the verge of becoming the new manager of Liverpool on a three-year deal.

The Swansea boss held talks with the Liverpool owners on Wednesday afternoon and is likely to be installed in the next 24 hours.

Fenway Sports Group (FSG), the Reds’ American owner, will pay around 5 million pounds in compensation to Swansea under the terms of the three-and-a-half year contract the Northern Irishman signed with the Welsh club in February.

Rodgers emerged as the leading candidate to replace Kenny Dalglish after Wigan boss Roberto Martinez ruled himself out of contention on Tuesday, as revealed earlier Wednesday.

Rodgers, 39, has agreed to work under FSG’s proposed management structure unlike Martinez, who was put off by the plans to divide the director of football role in to three separate positions.

Swansea chairman Huw Jenkins confirmed in a statement on the club's website on Wednesday evening that the former Watford and Reading boss said he wanted to take the Liverpool job having initially spurned an approach from the Merseyside club two weeks ago.

At that stage, he wanted to avoid appearing disloyal to Swansea while the Reds had a long list of candidates, but now it became apparent this week that Rodgers was a genuine front runner to replace Kenny Dalglish, who was sacked on May 16.

"I was contacted by Liverpool last night and they expressed their wish to speak to Brendan regarding their vacancy," Jenkins said.

"I had a discussion with Brendan to talk about their interest and his views on whether he wanted to speak to Liverpool. He expressed his wish with me to do that and he has spoken to Liverpool today.

"Following on from discussions with Liverpool's owners, Brendan has informed us that he would like to take up their offer to manage Liverpool."

FSG went in search of a young, dynamic manager who is capable of introducing a footballing ethos which runs through all levels at the club.

Principle owner John W Henry remains determined to implement a tiered management structure and Rodgers will work alongside three men taking on the duties performed by former director of football Damien Comolli.

The Reds’ groundbreaking plan is to employ one executive to oversee statistics, another whose role will be to conduct negotiations and a third ‘football man’ with contacts within the game.

Rodgers, Martinez and former Chelsea manager Andre Villas-Boas were the leading contenders at the start of the process while the likes of Frank De Boer and Jurgen Klopp were quick to dismiss the notion of moving to Anfield.

Rodgers caught the eye last season as he guided Swansea to an 11th place finish in the club's debut season in the Premier League, earning praise from rival fans and managers for his commitment to possession-based football.

He will be tasked with improving upon Liverpool's disappointing 8th-placed finish under Dalgish this season, with the Merseyside outfit picking up only five league wins after the turn of the year.

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