Birmingham are prepared to make Mark Viduka the highest-paid player in their history in a bid to lure him to St Andrews.
But manager Steve Bruce still looks like losing out in his bid to sign the Australian international, who is available on a free transfer from Middlesbrough, with Newcastle remaining favourites to sign him.
Blues are willing to offer the 31-year-old striker a £60,000-a-week package as they recognise the need to bring in extra firepower following the return of the on-loan Nicklas Bendtner to Arsenal.
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