Manchester United are favourites to sign Leicester City youngster Jeffrey Schlupp for £2.5m, according to the Telegraph.

The 20-year-old was on a one-week trial with United in January, which was later extended by Sir Alex Ferguson and his coaching staff. The striker impressed for the Old Trafford club during their U21 win over Liverpool last week, after being deployed as the lone striker.

Sir Alex Ferguson

The Championship side's manager Nigel Pearson has revealed the Premier League leaders are likely to enter into further discussions, regarding the Ghana international's future.

"I think we'll be discussing this week what the next step is. He's done well at United, he's played the last two games that he can play there so clearly it's going to have some effect this week," Pearson said.

However, even if both the clubs reach an agreement over Schlupp's transfer, he will not feature for Ferguson's side until the beginning of next season. The youngster, who can play as a forward or even as a left-back, could give Ferguson more options either in the attacking division or at the back.

United have a great relationship with Leicester as defender Michael Keane has been loaned out to them for the rest of the season, while former Red Devils Ritchie De Laet and Matty James are now with Pearson's side. In addition to this, Tom Cleverley had spent a loan spell with them in 2009.

Owen: United Can Win Champions League

Micahel Owen

Meanwhile, former United striker Michael Owen believes Ferguson now has one of the best squads of all time at his disposal and they are capable of acheiving European glory. The Red Devils face Real Madrid at Old Trafford in the second leg of the Champions League last 16 tonight. (read the IBTimes UK preview for the game here).

"Sir Alex Ferguson at the minute has got one of the best teams he has ever assembled. He will be thinking what a waste if we don't win another Champions League in the next few years. This year his team are pretty healthy, no main players are injured, they are in good form and everything is perfect in the United camp at the moment and you have to take advantage," Sky Sports quoted Owen.