West Ham are close to finalising a compensation agreement with Sheffield United worth around €10.7million to end the long-running Carlos Tevez saga.

An announcement confirming the arrangement could be made as early as Friday and it is understood West Ham have arranged to pay the compensation in instalments over the next five years.

Sheffield United had originally lodged a claim for €48million in lost revenue following their relegation from the Premier League in 2007.

West Ham argued their own research into the real cost of relegation, when all the savings from wages and recruitment had been taken into account, was no greater than €5.3million.

It appears a final settlement in the region of €10.7million has been agreed upon, which represents a victory for Sheffield United - but on terms acceptable to West Ham.

Sheffield United's claim for damages was supported last year by an independent FA tribunal chaired by Lord Griffiths.

He ruled Tevez had made a decisive difference as West Ham avoided relegation at Sheffield United's expense after being signed in breach of the Premier League rules on third-party ownership.

The Griffiths panel was due to meet on Monday to discuss the level of damages due to Sheffield United and it is understood West Ham did not want to risk another adverse finding.

By striking an out-of-court settlement with Sheffield United, West Ham have ended the Griffiths process and been able to agree a payment structure which will not jeopardise the club's financial standings.

A separate joint Premier League and FA investigation into the affair will continue.