Sunderland have moved a step closer to appointing Steve Bruce as their next manager after a compensation package was agreed with Wigan.

The former Manchester United defender is the Black Cats' number one target to replace Ricky Sbragia, who resigned on the final day of the season after keeping the club in the Barclays Premier League.

Wigan chairman Dave Whelan, who paid Birmingham £3million to release Bruce from his St Andrews contract in November 2007, insisted the north-east club had to come up with worthwhile remuneration before they could speak to his manager.

That financial package has now been agreed and Sunderland officials are believed to be in Portugal - where Bruce is on holiday - to thrash out personal details.

Bruce, born in Corbridge just outside Newcastle, has often been linked with the manager's job at St James' Park but a return to his native north-east with Sunderland would be equally welcome.

And after American businessman Ellis Short assumed total control at the Stadium of Light last week it would appear Bruce will have access to a substantial transfer fund should he take the job.

That will differ vastly from his tenure at Wigan, where he has been forced to sell his best players and look for bargain buys.

The £14million departure of midfielder Wilson Palacios to Tottenham and the £3.5million sale of Emile Heskey to Aston Villa in January were major contributory factors in Wigan's bid for European football fading in the second half of the season.

With winger Antonio Valencia destined for an £18million exit this summer, Paul Scharner touting for a move and just one first-team striker on the books Bruce was facing another rebuilding exercise at the JJB Stadium.

There has also been speculation Bruce had to slash the wage bill by £4million for the start of next season, which could have led to more players being shown the exit.

At Sunderland he will get the chance to build by buying in proven quality rather than having to rely on a scouting system which regularly took him to South America to recruit untested players.