The Reds’ gaffer is poised to end speculation over his future by putting pen to paper on a long-awaited contract extension.

Liverpool is flying higher this season than it has for the best part of a decade. Only goal difference separates them from the Premier League leaders, Chelsea, and they secured their spot in the Champions League knockout rounds with Wednesday’s win over Olympique Marseille.

And still, there has been considerable doubt as to whether Rafael Benitez will remain the club’s manager beyond the end of the current campaign.

The Spanish tactician was promised a contract extension at the start of the year but, after a series of false starts, negotiations only kicked earlier this month.

Liverpool co-owners Tom Hicks and George Gillett have seemed curiously reluctant to reward Benitez with a new deal, perhaps due to lingering uneasiness between the two parties after the boardroom antics that plagued the club last season.

However, Real Madrid’s increasing interest in Rafa appears to have spurred the American investors into action, as a two-year extension is expected to be wrapped up by Christmas.

Benitez said: "My advisers were in contact with them and we are waiting for a new contract right now. Sooner rather than later we will have another communication."