The Mirror reported recently that Liverpool are preparing to welcome the Dutchman to Melwood for a medical this week.
It's been previously reported that Newcastle United want a player-plus-cash deal for one of their prized assets, who netted 11 Premier League goals for the relegated Magpies last term, with a straight deal likely to cost the Reds £25 million.
That being said, the 25-year-old has also reportedly courted interest from Spurs, but Nicol, who spent 14 years at Anfield, hopes to his former club win the race for his signature.
"I believe there are other teams interested in Wijnaldum," he said to ESPN. "This guy scored 11 goals for a team who got relegated last season, so he can put the ball in the back of the net.
"He's kind of multi-purpose - he can play anywhere across the middle of the park - so I think it would be a good signing for Liverpool."
With Jordon Ibe joining Bournemouth, there is room in Jurgen Klopp's squad for another wide player - if that is where the German manager envisages him.
He wouldn't be cheap but there is a sense that he would be worth his £25 million price-tag. Four of his 11 Premier League goals came in the same match last term and it is obvious that the Netherlands international knows where the goal is.