MIKE ASHLEY is adamant he will not be shelling out up to £5m in compensation for Steve Bruce, but Sheffield Wednesday owner Dejphon Chansiri is refusing to lower his demands for the current Owls boss.

While Newcastle’s first-team squad have landed in China ahead of their Premier League Asia Trophy opener against Wolves on Wednesday, Bruce remains in a state of limbo with the financial terms of his proposed switch to St James’ Park still to be agreed.

While the North-Easterner signed a one-year rolling contract when he took over at Hillsborough in January, Chansiri insisted on a compensation clause being written into the deal that protects Wednesday in the event of a Premier League club wanting to recruit the 58-year-old.

That is the situation Newcastle find themselves in, but while Chansiri is demanding around £5m before he will sanction Bruce’s departure – along with the exit of Steve Agnew and Stephen Clemence, who currently form a key part of Bruce’s backroom staff in Sheffield - Ashley regards the sum as much too high. His managing director, Lee Charnley, has been attempting to thrash out a compromise, but two rounds of talks have failed to produce a resolution.

As a result, Bruce was at Sincil Bank on Saturday, leading a Sheffield Wednesday side to a 3-1 friendly win over Lincoln City.

It proved an eventful afternoon, with a Sheffield Wednesday fan confronting Bruce in the dug-out in the early stages of the game, but while he spoke to the media after the final whistle, the former Sunderland boss was unable to shed too much light on the situation.

“For me, at this particular moment, there is nothing really to talk about until the two clubs reach some sort of compromise,” said Bruce. “I’ve had a conversation (with Newcastle).

“It’s happening so quickly that I’ve got to take stock of the whole situation. It’s in the hands of both clubs and we’ll see what develops over the next 24 to 48 hours.

“The clubs have got to agree before any discussions and all the rest of it. Let’s see what happens, I cannot really comment any more than that.

“Out of respect, I thought it was only right to go and talk (to Newcastle), it was over with before it started, thankfully the chairman gave me permission to go and have a conversation.

“I don’t really want to talk about dream jobs and all the rest of it, it's a bit pie in the sky at the moment. I’m the Sheffield Wednesday manager and I have to respect that. I’ve been very, very happy here, of course I have.”

Nevertheless, Bruce has told Chansiri he wants to take over on Tyneside, and a compromise is still expected to be signed off in the next couple of days.

The Corbridge-born boss is understood to have agreed the personal terms of his proposed contract with the Magpies, with his basic salary set to be around £1m-a-year.

That represents a huge decrease on the £6m-a-year that Rafael Benitez was earning prior to his departure, however Bruce’s salary will include a series of incentive-based payments that will see his wages increase significantly if he keeps Newcastle in the Premier League next season. If he can guide them into the top half of the table, his wages will start to approach the levels Benitez was earning.

Bruce has also discussed summer transfer plans with Charnley, and the £50m spending pot that was set to be available to Benitez remains on the table. It should also have been swelled by the £30m that was received from Leicester City for Ayoze Perez.

The extent of Bruce’s control over that budget remains uncertain, with head of recruitment Steve Nickson set to assume a much more influential role in Newcastle’s recruitment team. Whereas Benitez’s contract guaranteed that he had the final say over all transfer matters, it is thought that the terms of Bruce’s deal will not include such cast-iron assurances.

Newcastle are the only Premier League team not to have made a signing this summer, and the weaknesses within the current squad are likely to be apparent when they line up in China this week.

With Bruce still in England, Neil Redfearn and Ben Dawson will take joint charge of Newcastle’s matches, with the latter expected to fulfil the majority of the club’s media commitments.

Martin Dubravka, Fabian Schar, Jamaal Lascelles, Matt Ritchie and Sean Longstaff are included in the squad that flew to China on Saturday morning, but Florian Lejeune and Rob Elliot miss the trip because of injury while Miguel Almiron, Christian Atsu and Henri Saivet are still on extended leave after their summer involvement in international competitions.