FORMER Town boss Neil Warnock is staying at Sheffield United. His rejection of Premier League strugglers Portsmouth has opened the door for Harry Redknapp to make a sensational return to the South Coast club.

And were that to happen, Southampton could install former England rugby union coach Sir Clive Woodward as manager.

Southampton rejected an initial approach from Pompey to talk to Redknapp after Warnock said he wanted to remain at promotion-chasing Championship club United.

But it is claimed the pair are in talks over compensation, with Saints demanding £220,000 and Portsmouth offering only £100,000.

Rangers' Alex McLeish, Northern Ireland boss Lawrie Sanchez and ex-Republic of Ireland coach Brian Kerr will be in the frame if Pompey fail to land Redknapp.

Former West Ham chief Redknapp left Portsmouth in November 2004, insisting he wanted to take a break from the game.

But just two weeks later he took over at Southampton.

At the time, Portsmouth chairman Milan Mandaric angrily claimed talks had taken place before Redknapp had left Fratton Park, but he insists the pair have now resolved their differences.

"I don't have a problem with Harry," he said.

"He did a tremendous job for us here and that's the main reason we'd like him to come back.

"He's very popular with our supporters and they are very important to making this decision."

Redknapp is believed to be unsettled at Southampton in the wake of Woodward's addition to the coaching staff in the summer.

Southampton were relegated from the Premier League last season.

Warnock's decision is a big boost for the Blades ahead of tomorrow's Sheffield derby.

He held talks with Mandaric, but said: "At the end I knew I wanted to stay.

"I think there's politics involved in Portsmouth and I don't want to get into that. I don't need the hassle.

"It's nice to have everything cut and dried and to know what we are doing."

Warnock, who once turned down the chance to manage Chelsea, admitted he had been tempted by a move to the Premiership.

But he added: "The decision's been made and I'm staying put.

"We've had a word with the players and we've got a tough game tomorrow. What's gone is gone and we move on.

"At the moment I run the club and I've got tremendous backing, a great bunch of lads and the best team I've ever managed."

Sheffield United plc chairman Kevin McCabe was delighted to see Warnock agree to stay.

"I have been able to show Neil - and he has recognised - he has a key role in shaping our quest for the top flight," said McCabe.

"I wish the Portsmouth saga had not started but in the end the outcome demonstrates the importance of the relationship between a chairman and his manager."

Warnock has been at the club for six years but his contract ends in June and he is still waiting for a new one.

While Southampton, who are 12th in the Championship, host Burnley tomorrow, Portsmouth, third-bottom of the Premier League, go to Manchester United.