The central defender has been linked with the Buccaneers since he led the Clever Boys to a league and cup double last year.
Wits clinched the 2016/17 Premier Soccer League (PSL) title and 2016 MTN8 Cup trophy with Hlatshwayo captaining the team.
Pirates reportedly tried to sign Hlatshwayo prior to the 2017/18 campaign, but Wits refused to sell the highly-rated defender.
This was after Hlatshwayo was quoted saying that he was a childhood Pirates fan and that he would like to play for the club.
The Soweto giants are believed to have made another attempt to sign the 28-year-old midway through the season, but Wits ignored interest from Bucs.
The Clever Boys then moved swiftly to offer Hlatshwayo a new contract which the player signed and he is now tied to the Johannesburg club until 2022.
Meanwhile, The Citizen have now reported that Pirates are prepared to sweeten the deal by offering Mpho Makola and other players for Hlatshwayo.
“Wits agreed to sell Hlatshwayo to Pirates, but they wanted [Abbubaker] Mobara," the source said.
Wits were heavily linked with Pirates defender-come-midfielder Mobara last January.
However, the 24-year-old player's proposed transfer to the Clever Boys never materialised and Mobara remained at the Houghton-based club.
"Everything was on course for the deal to happen until Mobara turned down Wits’ offer,” the source continued.
“Pirates are now offering Mpho and other players to try to sweeten the deal, but nothing has been agreed upon so far," the source concluded.
Hlatshwayo, who struggled with injuries, made 21 league appearances for the Clever Boys during the 2017/18 season.
Makola is another Pirates player, who has been linked with Wits, but the Soweto giants extended his contract for a further year until June 2019 last January.