Newcastle United are close to agreeing a new contract with star midfielder Bruno Guimaraes in a bid to fend off interest from Real Madrid and Liverpool.

Telegraph Sport understands that significant progress has been made this week after months of negotiations with the Brazil international and his representatives.

Chelsea and Liverpool enquired about signing the 25-year-old in the last two transfer windows but were immediately told the player was not for sale at any price. Real Madrid have also been closely monitoring the player given the huge impact he has had on the Premier League since his arrival from Lyon in January 2022 for an initial £38 million, which could rise to £43 million with add-ons.

One of the sticking points in the protracted negotiations is thought to have centered over whether there would be a release clause inserted into the new deal.

Bruno’s advisers are conscious of the risks attached to agreeing a long-term extension without having some room for manoeuvre in the future, while the club have previously refused to agree to release clauses since the takeover by Saudi Arabia’s Public Investment Fund in October 2021.

If a release clause has been agreed, sources have stressed it would be set well in excess of £100 million to deter would-be buyers.

Newcastle have always known that there could come a time when they had to sell the South American given he could well be tempted by a move to Spain at some stage.

But they have been determined to protect their asset, as well as reward him for the excellent form he has shown over the last 20 months.

Given the fees paid for Declan Rice, who signed for Arsenal for £105 million, and Moises Caicedo, who signed for Chelsea for £115 million, it would be reasonable for Newcastle to value Bruno at the same price bracket.

In the short term, though, the new contract will be a big boost for Newcastle and manager Eddie Howe who did not want the contract talks dragging on any longer.

Sources have also stressed that the player has not shown any interest in a move since he arrived in England and is very happy on Tyneside.

By his own high standards, Bruno has not been at his best as Newcastle have got off to a slow start in the Premier League, suffering three defeats in their first four games.

But he remains integral to the team’s style of play under Howe and supporters will be delighted he is close to signing an extension. Bruno was already one of the top earners at St James’ Park but is now likely to join captain Kieran Trippier on wages of around £120,000-a-week.