Dundee United are in talks to sign full-back Paul Dixon from local rivals Dundee.
Dixon is out of contract with Dundee and the First Division club have accepted United's offer of compensation.
Kilmarnock were also rumoured to hold an interest in the 21-year-old, but a deal in the region of £25,000 has been accepted by Dundee.
United manager Craig Levein has now been given permission to open talks with Dixon, with a view to adding the defender to his Tannadice squad.
"As a board we considered what we had on the table in way of compensation for Paul Dixon and decided the best deal for our club was to allow the player to speak to Dundee United," Dark Blues chief executive Dave MacKinnon told the Courier.
Dixon has spent his entire professional career with Dundee and has made in excess of 100 appearances for the club.