Harry's offered £20m transfer kitty, but fans still call for Shearer

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Redknapp, 60, has spoken to a number of influential football people, who have advised him to take the job. A friend said last night: 'Harry knows Newcastle are a massive club with great ambition. His style of football would go down a storm there. We're all telling him to take it, but he feels a strong loyalty to Portsmouth.'

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Newcastle, who sacked manager Sam Allardyce on Wednesday, are willing to give Redknapp funds to revitalise the team. Ashley would also have to pay £1.5m compensation to Portsmouth.

Interestingly, Newcastle have already tabled a £4m bid for Arsenal midfielder Lassana Diarra, a player monitored by both Allardyce and Redknapp, and chairman Chris Mort is confident of landing the 22-year-old Frenchman in the next week.

Ashley, who is in Hong Kong, and Mort may be thousands of miles apart, but the pair are working swiftly to get their new manager and want him in place before Wednesday's FA Cup replay at home to Stoke City.

Portsmouth issued a statement on Thursday night claiming they have not been approached by Newcastle. It read: 'We take it as a compliment that our players and personnel are often linked with some of the top football clubs in this country and indeed abroad. It is a testimony to the quality of their work.

'The club have received no approaches for the services of our valued manager Harry Redknapp, who recently signed a new improved fouryear contract with Portsmouth.

'The club have made significant investments over the last two years in both players and infrastructure and the results that are now being enjoyed are the fruits of those investments.

'Last season the club finished in their highest position for 52 years (ninth) and this season we are on course to better that. We have recently won nine out of 10 away games, a club record. We are in the middle of the busiest time of the season because of a heavy fixture list and the month-long transfer window and, as such, this speculation is unhelpful.'

Ashley has drawn up a short-list which is topped by Redknapp — but also includes Mark Hughes, Jose Mourinho and Jurgen Klinsmann. However, Redknapp is his No 1 target.

Former Tottenham director Paul Kemsley, a close confidant of Ashley's and friend of Redknapp, claimed the Newcastle board had been reluctant to hand Allardyce more cash in the transfer window.

He had signed nine players with more than £27m of Ashley's funds but had limited success with his new faces. Although three teenagers were added to the Newcastle squad in the last fortnight, Ashley was unhappy about the prospect of spending more cash this month.

Kemsley said: 'People have to realise that Sam Allardyce was not Mike's choice — Mike bought the club with him already employed.

'Mike took the view that "he is in the job, let's see if he can deliver what I want, which is good-quality, attacking football and to win games. I'll give him time to see if he can deliver that".

'Mike has put £250m into the club and is about to invest more in the window, and I suspect he wants to invest that in his own man and his own team.

'It's certainly costing Mike a lot more initially than he thought it would. He, along with everybody else at Newcastle, wants to see good-quality football — they want to win, and he's a winner.'

Allardyce, meanwhile, is heading on holiday with his wife, taking stock of his future before deciding when and where to return to management, which he fully intends to do. He insists there is 'no point being bitter' with those at St James' Park. Talking outside his Durham home, he said: 'Once people make a decision, there's nothing you can do about it.

'There's no point being bitter and twisted because that will only affect you. It does not affect the people you have left.

'For me, it's the future now. I'll take a break with my wife and go away, have a little bit of a recharge of the batteries then move on with my football career.'