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Newcastle United midfielder Mikel Merino looks set to leave the Tyneside club, with Spanish newspaper Mundo Deportivo reporting the player is in 'very advanced' talks with Real Sociedad over a €12m move.

The 21-year-old Spaniard joined Newcastle from Borussia Dortmund initially on loan, before the Magpies exercised an option to make the deal permanent.

However, after suffering a back injury in the first half of the season, Merino lost his place in the team and struggled for form since his return to the squad.

As a result, there has been much speculation back in Spain that Merino will return to his home country this summer.

According to Sport Witness, Real Betis, Athletic Bilbao and Real Sociedad were all interested in the midfielder and approached him to determine the player's interest in a move.

Mundo Deportivo have since claimed that Real Sociedad are in the driving seat for the deal, while Bilbao have stepped back their interest, prioritising other targets this summer.

Merino is of Basque heritage, making him eligible to play for Bilbao - who choose to only sign and play Basque players as part of their self-imposed cantera policy.

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Real Sociedad are understood to be wanting to move forwards with the transfer this week.

Mundo Deportivo quoted regional Basque broadcaster Euskal Telebista as reporting: "The negotiations between the parties [Newcastle and Real Sociedad] are very advanced after the approaches that have taken place in recent hours."

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Newcastle have been looking to clear a number of players off of the club's wage bill this summer, as well as generate some additional transfer funds.

While manager Rafa Benitez rates Merino as a huge talent, his rapid decline in form since his back injury might see the club tempted to cash in on the Spanish under-21 international.