Alvaro Pereira
Uruguay's Pereira is fouled by Mexico's Aguilar at the Copa America tournament in La Plata. REUTERS

Chelsea face competition from Paris-Saint Germain for the signature of Porto wing-back Alvaro Pereira, as manager Andre Villas-Boas attempts to bolster his squad before the start of the new campaign.

Villas-Boas is prepared to bid around £17.5m for the 25-year-old Uruguayan international, as he seeks a replacement for Zhirkov, who was sold to Russian side Anzhi Makhachkala last week.

Pereira is familiar with Villas-Boas, having worked with the new Chelsea manager at his former club, Porto.

However, the Portuguese champions value the left-back at closer to £26m and Villas-Boas faces competition from newly-rich Paris-Saint Germain who have also been linked with the player.

The 33-year-old remains interested in Pereira's team-mate, Joao Moutinho but his release clause of €40 million has dissuaded Villas-Boas from submitting an official bid thus far.

Nevertheless, Chelsea may yet turn to the Portuguese international should they fail in their pursuit of Tottenham's Luka Modric, the Telegraph reports. Chelsea are expected to increase their offer for Modric to £30m before the end of the transfer window but Spurs chairman Daniel Levy is determined to hang on to the 25-year-old midfielder and is expected to rebuff any advances for the player.

Villas-Boas has already signed the Spain Under-20 international Oriol Romeu and on Monday he finalised the transfer of 18-year-old Belgian international Romelu Lukaku from Anderlecht.

Lukaku is viewed as the long-term replacement for striker Didier Drogba and the 33-year-old was once again linked with a move to AC Milan in today's press.

The Cote d'Ivore international, however, is confident of signing a contract extension that will keep him at Stamford Bridge until 2013, the Daily Mail suggests.