Dundee United have agreed terms with Rangers striker Billy Dodds and his agent, BBC Scotland can disclose.

But the Ibrox club will not make a decision on his release date until the end of the week at least.

It is understood that Dodds is keen to make a return to Tannadice three years after moving in the opposite direction for �1.3m.

The transfer now hinges on Rangers, who allowed the 33-year-old to talk to United, deciding on whether they release him in January or at the end of his contract in May.

As far as we are concerned, there's no problem with Billy Dodds' terms Dundee United chairman Eddie Thompson

Sources close to Rangers suggest that the Ibrox club are near to securing the signature of United's Steven Thompson.

The Scotland striker is out of contract in the summer.

But United insist that no official approach has been made for the 24-year-old - and that they are still hopeful of re-signing him themselves.

United are keen to have Dodds complete his move during January's transfer window and see him as an ideal strike partner for Thompson.

Rangers are keen to offload Dodds from their hefty wage bill, his reputed �10,000 per week salary having long been viewed as a stumbling block to a transfer to another SPL club.

But United chairman Eddie Thompson has said that money is not a problem as Paul Hegarty's side attempt to lift themselves out of relegation trouble.

A United spokesman said: "In principle and verbally, terms have been agreed with Billy Dodds and his representatives.

"However, apart from Billy having the final say, just as importantly, Rangers Football Club would have the final decision on whether Billy can leave the club in January or at the end of his contract in May.

Thompson (left) has been linked with Rangers

"That decision is very much in their hands."

New owner Thompson is still hopeful of securing an extended deal with his striker namesake, who has now won seven Scotland caps and become an established member of Berti Vogts' squad.

However, negotiations may have started too late.

Thompson has been linked with a move to Rangers, with some suggesting that he has already agreed to join the Glasgow outfit next summer on a Bosman free transfer.

But the United chief said: "We are still working on it and there have been no approaches from any club whatsoever to do with Steven.

"Paul Hegarty and I are quite happy with that because we would like Steven to remain at Tannadice."