Club sporting director Leonardo confirmed last week the Ligue 1 champions had tabled a bid for the Uruguay star, with reports suggesting they had agreed to match his €63 million (£53.8m) release clause.
Although the Brazilian is set to stand down from his post at PSG, Blanc remains optimistic that a deal to bring the coveted striker to Parc des Princes will be completed.
|16/1||PSG are 16/1 with BetVictor to win the Champions League
PSG are also in the hunt for Roma defender Marquinhos, who has been linked with a move to Barcelona, and Blanc admits the interest in the 19-year-old will complicate any potential deal.
"I know the player very well from Serie A," he said of the Brazilian. "It's a difficult issue since, from what I know, we're not the only ones after this player. It proves his value.
"Our priorities in the market, as I said a few days ago, are to find a striker and a left-back."
Blanc is dismayed at Leonardo's impending departure, stressing that he would have loved to work with the former AC Milan star far beyond this summer.
"I would have liked to continue working with him," Blanc added. "We worked together for two weeks and had a truly good understanding.
"When I signed for PSG, I didn't know he was leaving. I understood he wanted to take a step back, but to then think he would not be there at all? No."