Roman Abramovich is ready to offer the 1998 World Cup winner an £8 million-a-year deal - which would make him the best-paid boss in Britain - the paper reports, adding that preliminary talks have already taken place between the Blues and the 46-year-old Frenchman's representatives.
The bumper pay deal is on offer because Blanc is out of contract after Euro 2012, meaning Abramovich would save millions in compensation - unlike last summer, when he forked out a huge sum to bring in Andre Villas-Boas.
Pep Guardiola and Jose Mourinho remain in the running, according to the paper, but Blanc is preferred by Abramovich's advisers as he is "the more realistic option".
Manchester City striker Edin Dzeko is being targeted by Juventus and Real Madrid after Roberto Mancini confirmed that he will listen to offers for the striker this summer, who is openly frustrated at his lack of first-team football despite boasting an enviable goalscoring record when given a chance.
The Daily Mail reports that Juventus have a £30m transfer war chest for the summer, but with Dzeko having cost £27m last year they may have to spend almost the whole lot on the 26-year-old.
Axed Wolves manager Mick McCarthy has tipped himself for a quick return to the Premier League - with Wolves. The Sun quotes the 53-year-old as saying that he remains on good terms with club chairman Steve Morgan, and that he would not rule out returning to Molineux to help them beat the drop this season. "Stranger things have happened in football," he said, adding that if Carlos Tevez can return to the fold at City then anything can happen. Tevez, incidentally, is widely tipped to make his first start since that return against Sunderland this weekend.
The money available to Paris St Germain's Qatari backers has seen them target some of the biggest names in the game, but the Mail reports that the latest on the list is something of a surprise: English forward Joe Cole.
Cole has done well since joining Lille on loan, but Liverpool are unwilling to continue subsidising his wages beyond the end of the season and the Ligue 1 side are unable to pay his full £130,000-a-week.
Enter PSG boss Carlo Ancelotti, who worked with Cole at Chelsea and is now considering paying the £5m that Liverpool want to sign the player permanently.
West Brom are trying to hang on to goalkeeper Ben Foster, who joined on loan from Birmingham when the Blues went down at the end of last season, according to the Daily Mirror. But Birmingham are refusing to deal, at least for the moment, hoping that they can win promotion and welcome the former Manchester United player back.
Rangers, meanwhile, are set to lose another key player this summer as Sone Aluko is being tracked by several English clubs, according to the Daily Record.
In other transfer gossip, Newcastle are considering a summer move to sign Lens star Geoffrey Kondogbia, a 19-year-old defensive midfielder (Daily Mail); Arsenal have been scouting Fiorentina midfielder Riccardo Montolivo (The Sun); and Aston Villa are tracking Spartak Moscow's 23-year-old Artem Dzuba (Daily Mail), a 6'4" forward who broke into the Russia national team last year.
And finally, Chelsea's amazing Champions League escape against Napoli apparently hasn't taught them a shred of humility, as several papers report. First, Didier Drogba annoyed Benfica by getting caught on camera showing mock fear following the draw; and second, The Sun reports that Roberto Di Matteo is so confident of progress that he has already asked for his side's FA Cup semi-final against either Tottenham or Bolton to be moved to a Friday to accommodate their Champions League semi-final.