Russell Martin left MK Dons to succeed Steve Cooper at Swansea in August 2021
Russell Martin's appointment as Southampton manager is being held up by a disagreement over compensation due to Swansea City for his services.
Swansea boss Martin has agreed to take over at Southampton as they rebuild after Premier League relegation.
However, the 37-year-old's move has not been finalised as the clubs have failed to agree compensation.
Martin's Swansea contract features differing release clauses depending on which club come in for him.
There is a year remaining on the deal Martin signed when he took over at Swansea in August 2021.
BBC Sport Wales understands the contract stipulates that a Championship club wanting to recruit Martin must pay Swansea about £1.25m in compensation, whereas a Premier League side would need to pay in the region of £2m.
Swansea believe Southampton must pay the higher figure because they moved for Martin before the Premier League season ended, while the Saints feel they should trigger the release clause for second-tier clubs.
Martin is due to sign a three-year deal at Southampton and had seemed set to be confirmed as Saints boss before their final game of the 2022-23 Premier League season, a 4-4 draw with Liverpool on 28 May.
The former Scotland defender wants to take a number of his Swansea staff to the south coast, including number two Matt Gill and goalkeeping coach Dean Thornton.
Southampton must also agree a compensation fee for Martin's backroom staff.
Swansea, meanwhile, are in the process of identifying Martin's successor, with Chris Davies emerging as one of the leading contenders to take over at the Swansea.com Stadium.
Davies is Brendan Rodgers' long-time assistant, having worked alongside the Northern Irishman during his spells in charge of Swansea, Liverpool, Celtic and Leicester City.
The 38-year-old is available having left Leicester when Rodgers departed in early April and is keen to become a manager in his own right.
Plymouth Argyle boss Steven Schumacher is also on Swansea's radar, while Birmingham City manager John Eustace - who the Swans came close to appointing before turning to Martin two years ago - has also been linked with a move to Wales along with former USA boss Gregg Berhalter.
Swansea are expected to appoint Luton Town's chief operating officer Paul Watson as their sporting director - although that move has also been held up - while head of football operations Josh Marsh seems set to remain at the club despite speculation surrounding his position.
Chief executive Julian Winter has left his role, although Swansea are yet to confirm his exit.