Julian Nagelsmann has agreed personal terms with Bayern Munich but RB Leipzig are demanding a world-record fee for their manager.
According to Sky Sports, Bayern made contact with title rivals Leipzig on Sunday and agreed terms with the 33-year-old.
Leipzig are demanding €25m.
Nagelsmann has recently been linked as a replacement for Jose Mourinho in Tottenham Hotspur but reports suggest he prefers to remain in Bundesliga.
Nagelsmann, nicknamed “baby Mourinho” was born in Landsberg am Lech, which is less than an hour west of Munich, and recently built a house near the city.
He took RB Leipzig to last season’s Champions League semi-finals and they are on course to finish second behind Bayern in the Bundesliga this campaign.
The Leipzig boss is one of the most sought after young coaches in Europe.
Julian Nagelsmann will replace Hansi Flick who asked Bayern Munich to terminate his contract at the end of the season last week after several disagreements with sporting director Hasan Salihamidzic.
Flick has also been struggling linked as a replacement for Joachim Low who will leave Germany national team at the end of this summer’s European Championship.