According to the BBC's Ben Smith, Liverpool will pursue a deal for Sanchez, who has impressed for Chile at the World Cup in Brazil off the back of a strong individual season with Barcelona last term. But they may face competition from United, who are plotting a move of their own for the £22m-rated star.
Lallana to Liverpool
It looks like Adam Lallana's £25m move to Liverpool from Saints has progressed extremely quickly following England's elimination from the World Cup and he could be unveiled as a Reds player at Anfield later this evening.
He would join Rickie Lambert, his former Southampton teammate, at the club. Luke Shaw has signed for Manchester United today in a busy day of outgoings at the south coast club.
Sanchez situation at Barcelona
The Chilean international had a good season on an individual level last term, scoring 19 goals and providing 10 assists in 34 appearances. But that hasn't been enough to save him from the transfer rumours, with reports in Spain claiming that Sanchez is one of several first-team players available at the right price this summer.
As many as 13 Barcelona players could be allowed to leave with new boss Luis Enrique ready to complete a squad overhaul at the Nou Camp.
Sanchez role at Liverpool?
Sanchez, a 2011 addition from Udinese, is quick, direct and excellent with the ball at his feet. He would bring something different to a Liverpool squad full of technically gifted attackers, but short of real pace - Raheem Sterling excepted.
With Champions League football at Anfield next season, the club needs to strengthen a squad that didn't have many game-changing options on the bench. The capture of Lallana helps, but Sanchez would be an even more impressive coup for the club.