The former Reds midfielder is ready to replace Arne Slot at Anfield, says BILD.
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Liverpool are planning a major restructuring this summer. Mohamed Salah's departure at the end of the season will be an opportunity for a fresh start.
Liverpool football director Michael Edwards wanted Xabi as a replacement for Jürgen Klopp, but he then chose to stay with Bayer Leverkusen.
A year later, Xabi took over Real Madrid, but was fired midseason. However, Edwards has never lost touch with Xabi.
Xabi is ready to accept a deal with his former club if a concrete offer is tabled.
However, a key for Xabi is to have influence over squad planning, something he did not get at Real Madrid. He does not want to repeat that mistake.