Dedic has an exit clause worth €50m in his Benfica contract, but Newcastle United are not expected to need it, with the two clubs discussing a fee closer to €35m, according to reports in Germany.
The 23-year-old Bosnia international would reunite with head coach Matthias Jaissle, who worked with him previously at both Liefering and Red Bull Salzburg — a relationship that has played a significant role in making Newcastle his preferred destination among several interested clubs, including other Premier League sides.
Newcastle's need at full-back has been sharpened by a mix of injuries and departures this summer. Tino Livramento and Lewis Miley are both currently sidelined, while the club has released Kieran Trippier, Matt Targett and Emil Krafth. Jaissle, appointed earlier this month as successor to Eddie Howe, has so far overseen the arrivals of Bazoumana Touré, Aladji Bamba, Lukas Hornicek, Sean Steur and Ewen Jaouen as the rebuild continues following the exits of Howe himself, Sandro Tonali, Bruno Guimarães and Anthony Gordon over the course of the summer.
Among those already moving on is Alex Murphy, who has joined Bundesliga 2 side Kaiserslautern on a season-long loan, becoming the latest academy product to leave St James' Park in search of regular football.
The 22-year-old made his first start for Newcastle in January's Champions League play-off win over Qarabağ at St James' Park, having made his Premier League debut against Chelsea in November 2023 after joining the club's academy from Galway United in 2022. He has added six substitute appearances since, and spent the second half of last season on loan at Bolton Wanderers, where he scored on his full home debut for the League One club.
The loan follows a similar departure for fellow academy defender Harrison Ashby earlier in the window, part of a broader pattern of Newcastle sending fringe players out for experience while the first-team squad is rebuilt around Jaissle's incoming signings.
Kaiserslautern opened their 2. Bundesliga campaign with a goalless draw against Wolfsburg at the weekend, and will be looking to Murphy for defensive reinforcement as their own season develops.