Sam Allardyce has held talks with Newcastle chairman Freddy Shepherd about the vacant manager's post.
Allardyce ended his eight-year reign as Bolton boss in April
Allardyce, who stepped down from his position as Bolton boss on 29 April, is favourite to succeed Glenn Roeder, who resigned last weekend.
"It was a good meeting and my agent will speak to Newcastle again over the next few days to discuss matters further," Allardyce told The Sun.
Shepherd said: "Sam's excited and we're looking forward to making this work."
Allardyce and Shepherd met for lunch at London Claridge's hotel on Friday to discuss the proposed deal.
Shepherd reportedly told his associates at the restaurant: "We want Sam's determination, enthusiasm and ability to lift the club."
Allardyce turned down the chance to manage the Magpies just under three years ago.
Last summer he was interviewed for the England job but was beaten to the role by Middlesbrough boss Steve McClaren.
Allardyce pledged to focus on Bolton but resigned with two league games of the season remaining. His assistant Sammie Lee was soon appointed as his successor.
Roeder resigned last Sunday after he and chairman Freddy Shepherd had come under fire from fans after Saturday's 2-0 home defeat by Blackburn.
His number two Nigel Pearson, who will be assisted by Lee Clark and Terry McDermott, will take charge of Sunday's final game of the season at Watford.