The Internacional youngster will move to Anfield for £500,000, according to UOL Esporte.
The 18-year-old has not yet made his senior debut for the Brasileiro club and has been a member of the Porto Alegre-based team’s youth sides.
However, the defensive midfielder is said to have impressed the Anfield outfit during a youth tournament held in Kuala Lumpur and Indonesia.
UOL Esporte claims that Brendan Rodgers’ men have agreed to spend £500,000 on the young star, who will join the club’s youth ranks.
Allan’s arrival will increase the number of Brazilian players at Anfield, with the Reds already splurging on Roberto Firmino this summer to join Philippe Coutinho and Lucas Leiva on Merseyside.
Rodgers’ side is clearly trying to bolster their youth ranks, with 16-year-old Barcelona winger Bobby Adekanye also penning a deal with Liverpool this week.
Following missing out on Champions League qualification last season, the Reds have been busy in the transfer market this summer and are clearly motivated to start next term with a bang.