Bayern Munich have stated that they have an 'outline' agreement with Schalke for Manuel Neuer.
The two clubs have been locked in talks for a number of weeks over the German international, who has long been linked with a move to the Allianz Arena.
Neuer was still being linked with a possible move to Manchester United, but Bayern's president Uli Hoeness has confirmed a deal has been agreed in principle.
"Our management has managed to outline an agreement with Schalke 04, the question now is whether they will want to formalise the deal," Hoeness told German television channel Sky.
Schalke face second division side Duisburg in the German Cup final next Saturday at Berlin's Olympic stadium and Hoeness speculated the deal may be finalised in the build-up.
"They have to decide whether or not it's a psychological advantage to announce the deal before the match," said Hoeness.
According to the German press, Bayern had originally proposed a fee of €14 million for Neuer, but then raised the offer to between €18 and €20 million, plus performance-related bonuses.
Neuer, who has spent his entire career at Schalke, has confirmed to the club that he would be leaving and would not extend his contract which has just over 12-months remaining.
Hoeness also admitted Bayern are interested in signing Bayer Leverkusen's Chile midfielder Arturo Vidal.