Charles, 22, is a central midfielder who came through Manchester City's academy and joined Southampton for a reported £15 million in the summer of 2023. He spent a productive loan spell at Sheffield Wednesday in 2024-25 before establishing himself as one of the Championship's most impressive performers last season.
His versatility — capable of operating in midfield, wide areas or at full-back — has made him one of the most sought-after young players outside the Premier League.
Southampton are holding out for more than Leeds United's initial offer, and any deal carries an additional complication. Manchester City inserted both a buy-back option and a sizeable sell-on clause into his original transfer, meaning a portion of any future sale returns to the Etihad Stadium. That diminishes Southampton's net proceeds and encourages them to squeeze every pound from any negotiation.
Charles has just over a year remaining on his contract at St Mary's, with the club holding an option to extend for a further season. Leeds are operating with the awareness that his value could increase significantly if he reaches the Premier League on his own terms.
Daniel Farke's club finished fourteenth in their first season back in the Premier League and reached the FA Cup semi-finals, and the board has sanctioned a serious rebuild this summer. Charles is understood to be keen on a move to West Yorkshire, having previously enjoyed his loan at Sheffield Wednesday, and is open to the step up to the top flight.
Southampton are simultaneously planning for his potential departure. The club has identified Hibernian midfielder Josh Mulligan, 23, as a possible replacement and are competing with Wolves and West Ham for his signature.
Crystal Palace's David Ozoh, who spent last season on loan at Derby County, has also been proposed. Middlesbrough, who face the possible loss of Hayden Hackney to Everton, are also monitoring Mulligan.
Leeds regard Charles as their priority midfield signing and expect further talks this week to narrow the gap.