Chelsea appear set to sign the Milan playmaker Kaka for a world-record €100m (£79.3m) after discussions took place this week, with both clubs and the Brazil international keen for a deal to go through. Sources at Stamford Bridge have confirmed that Chelsea are targeting the 26-year-old and it is understood that Milan are inclined to accept a bid of €100m tabled this week.

Initially reluctant to depart, Kaka now believes the transfer, which would smash the record of £46m Real Madrid paid for Zinedine Zidane in 2001, is in everyone’s interests. His contract does not expire until 2012 but he is eager to play for Luiz Felipe Scolari, who gave him his international debut against Bolivia in 2002 and included him in the Brazil squad for that year’s World Cup finals despite him being only 20 years old. The current world and European player of the year also believes Chelsea are the most attractive destination in European football.

Chelsea sent a representative to Milan this week to present a bid to the Italian club. Far from rejecting the offer out of hand as is normal practice and as they did with approaches from Real Madrid last summer, Milan sent a delegation to London and negotiations have continued.

Discussions have also taken place with the player’s camp over personal terms, with Kaka, who has scored 22 goals in 59 games for his country, set to earn a significant rise on his salary as well as a €15m signing-on fee. He will arrive in Milan today after spending the summer recovering from arthroscopy on his knee at Sao Paulo’s training centre in Brazil.

“Real Madrid offered €90m last summer and Milan did not even think about the bid,” said Kaka’s personal assistant and closest adviser, Diogo Kotscho. “This time is different. This is the first time we feel that a deal will definitely happen. Because of the [financial] situation Milan are in at the moment, the deal is good for all parties involved.

“The move would represent a significant increase in Kaka’s salary, on top of the 10% transfer fee that goes straight to the player anyway - some €15m. Chelsea are the club to be at right now. They are building a team to win everything.”

Given their current financial difficulties, Milan can ill afford to reject such a huge bid. Having failed to qualify for the Champions League, they have had to cut costs at the same time as embarking on the renewal of an ageing squad. They continue to seek a striker and the sale of Kaka would enable them to follow through on their interest in Arsenal’s Emmanuel Adebayor, despite their vice-president Adriano Galliani’s claim that Ronaldinho would be their final signing of the summer. Meanwhile, the arrival of the former Barcelona player - and the tumultuous reception he was given - has persuaded them they can release Kaka, safe in the knowledge that they have a glamour signing in his place.

Kaka believes he has shown his loyalty to Milan by staying last season, despite Madrid’s interest. He has not demanded a transfer this season either, with the impetus coming from the two clubs. However, he does not want to continue at a club that will not play in this season’s Champions League. Kaka’s relationship with Galliani and the club’s owner Silvio Berlusconi has also been strained by Milan’s refusal to allow him to represent Brazil at the Olympics. Milan said Kaka was “tired” - a claim he publicly denied. Worse still, Ronaldinho has been allowed to go to Beijing.

If the deal can be completed it would virtually destroy the chances of the Real Madrid forward Robinho completing his “dream” move to Stamford Bridge. The La Liga champions are unwilling to sell until they can sign Cristiano Ronaldo from Manchester United. Last night Sir Alex Ferguson insisted the Portugal winger would still be at Old Trafford next season.

Ref From guardian.co.uk

Luiz Felipe Scolari begins life as Chelsea’s manager this morning having secured his first signing. The Champions League finalists yesterday completed the purchase of the Barcelona midfielder Deco on a two-year contract.

The 30-year-old playmaker has followed his Portugal manager to west London in an £8m deal which may yet have an effect on Frank Lampard’s future at Stamford Bridge. The England midfielder is currently on holiday in Italy but with only a year to run on his contract he has been courted byChelsea’s former manager, Jose Mourinho, who is now at Internazionale. Deco’s arrival appears to threaten Lampard’s place in the team.

The Premier League club had been unsure whether Deco, who was below par in a Barcelona side well adrift of Real Madrid last season, represented value for money but they were persuaded by his fine form at Euro 2008. The midfielder was a key member of Scolari’s squad in Austria and Switzerland as Portugal reached the quarter-finals and has long been viewed as the coach’s on-pitch lieutenant.

“I am sure I have come [to Chelsea] at the right time to do great things and be able to help Chelsea go back to the way it was and be first, not only in England but also to win the Champions League,” said Deco. “That has been their dream for so long. The Premier League is a great league and it is getting better. You could see that at the Champions League final where you had two English teams.”

“It is great that we have so many great players here at Chelsea and it is great that there is the competition which is healthy for everybody. This just makes the team better. To have great players in any position just enhances the club. I know it is a new challenge but I am looking forward to it. I know I need a little bit of time to adapt but I am sure I will adapt quite well and quite fast and do my best for the team.”

The Brazilian-born midfielder is a two-times European Cup winner, with Porto in 2004 and Barcelona in 2006, who came close to moving to Stamford Bridge in the summer of 2004. He fell out of favour towards the end of Frank Rijkaard’s reign at Barcelona.

His vision and ability on the ball will be appreciated in the Premier League, with the creativity that was a key factor for Scolari’s Portugal team. He joins his national team-mate Jose Bosingwa, a £16m arrival from Porto, at Chelsea and his signature is a small victory for the club over Mourinho. The Inter manager had hoped to be reunited with a player he first coached at Porto, where Deco earned the nickname “Magico”. Further struggles appear to lie ahead, however.

Scolari supplied a list of potential signings to the Chelsea chief executive, Peter Kenyon. It was topped by Milan’s Kaka. Scolari would still like to meet the likes of Lampard and Ricardo Carvalho to discuss their prospects at the club. Inter have expressed interest in both players.

Chelsea’s first-team squad are due back at training next Monday. Chelsea had wanted to keep Lampard but they are aware that, though there has been no formal contact between the clubs, Inter have made their interest known.

Carvalho’s future in west London has also, potentially, been complicated by Mourinho’s appointment at Inter. Chelsea had intended to open discussions with the player on a new contract when he returned for pre-season training. Asked about his future, the Portugal defender was noncommittal both prior to the Champions League final and at Euro 2008.

Ref From guardian.co.uk