HITC Sport understands from sources close to the club that Sheffield Wednesday are confident of securing the permanent signing of Lewis McGugan from Watford.
McGugan enjoyed two successful loan spells at Hillsborough last season, making 29 appearances for the Owls and scoring three goals for the club.
The midfielder faces an uncertain future at Watford following their promotion to the Premier League and it appears as though he is surplus to requirements after being shipped out on loan last season.
McGugan is entering the final year of his contract at Vicarage Road and Watford would prefer to sell him this summer rather than lose him for nothing at the end of next season.
A number of other Championship clubs are thought to be monitoring the former Nottingham Forest star's situation at Watford and are weighing moves to rival Sheffield Wednesday.
However, Wednesday officials are confident of tying up a move for McGugan as Stuart Gray has made the 26-year-old one of his top targets this summer.