The report states that Saints boss Ronald Koeman is a big fan of the winger, and the South Coast club would pay Newcastle back the £12 million they spent on bringing him in during the January transfer window.
The England international traded Spurs for Newcastle in January, signing a five-and-a-half year deal despite the Tyneside club struggling near the bottom and facing the prospect of relegation.
Signing Townsend was undoubtedly a gamble on Newcastle’s part, yet in recent weeks it appears to be paying off as the winger has contributed greatly to the club’s excellent form.
The 24-year-old netted the winner in a 1-0 victory over Crystal Palace on Saturday, moving Rafa Benitez’s side out of the bottom three for the first time since Valentines Day.
However, they are not out of trouble yet, and a relegation to the Championship would pose a number of problems for the Toon Army with several players clearly on Premier League wages.
Townsend is too good for the second tier, and he would be among the first to be linked with a move away.
The Sun suggest Southampton are quietly waiting in the wings, with boss Ronald Koeman looking for top quality wide players this summer in order to strengthen his side’s push for the European places.