Hibs reject £300k offer for manager Colin Calderwood

The fee was thought to be in the region of around 300,000, with a source close to Birmingham revealing that talks were "ongoing".

Calderwood is now in the tricky position of continuing in his employment at Hibs while behind-the-scenes negotiations continue as Birmingham seek to secure the release of the man new manager Chris Hughton wants to assist him.

The situation has been complicated by the charges which have been brought against Birmingham owner Carson Yeung for alleged money laundering. Hong Kong-based Yeung was released on bail yesterday until the next hearing, scheduled for 11 August.

But football business continues to be done at St Andrew's in the owner's absence, with Adam Rooney joining the club this week after his contract at Inverness expired while Birmingham midfielder Craig Gardner joined Sunderland yesterday in a 6 million deal.

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The securing of Calderwood's services would be a boost to a club shaken by the loss of manager Alex McLeish to Aston Villa. Birmingham chairman Peter Pannu has also claimed that their rivals want to take two members of McLeish's old backroom staff to Villa. They are thought to be former Celtic midfielder Peter Grant and goalkeeping coach Dave Watson. Andy Watson, McLeish's long-term assistant, wants to remain at St Andrew's but could be pushed aside if Calderwood is recruited.

Calderwood was at Hibs' East Lothian training centre yesterday as his side continued their pre-season training, prior to tomorrow's friendly at Berwick.