Cheapskate Chelsea sign up Brazil ace Alex for $1

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The Chelsea manager, who will announce another bargain capture on July 1 when Steve Sidwell joins on a free transfer from Reading, is close to tying up the deal with Dutch champions PSV Eindhoven, who confirmed Alex has been in London for talks.

Alex was bought by Chelsea from Santos for £5million in 2004, but they were forced to 'park' him at PSV after he failed to meet work permit criteria.

Although Chelsea maintain they do not own the defender, who was named last night in the Brazil squad to play England at Wembley on June 1, the FA Cup finalists have an agreement to re-sign him at any stage for $1 (50p).

Alex was in London the day after Chelsea's 1-0 victory over Liverpool in the first leg of the Champions League semi-final at Stamford Bridge and agreed terms before flying back to help clinch the Dutch title on April 29.

Mourinho was first offered the chance to sign Alex - whose goal knocked Arsenal out of this season's Champions League - during January. Instead, the Chelsea chief went for Bolton defender Tal Ben Haim but that deal collapsed.

PSV spokesman Pedro Salazar-Hewitt revealed last night: 'Alex has been in London for talks with Chelsea. They held a series of meetings at the end of last month and it was done with the full co-operation of PSV. It is no problem.'

Mourinho is also hopeful of persuading Atletico Madrid striker Fernando Torres to join, but he claimed yesterday that the days of extravagant spending at Chelsea are over.

He said: 'Manchester United have the potential to pay a big fee for a player and that is normal. Everyone wants to improve and Chelsea will do the same without spending so much money.'