(ANSA) - Rome, December 31 - Ronaldinho looks set to leave AC Milan and return to his Brazilian homeland in the January transfer window, with the side he started out with, Gremio, the most likely destination.

Milan chief executive Adriano Galliani met the forward's brother and agent Roberto de Assis on Thursday and is said to have given the green light for his departure.

Brazilian clubs Flamengo and Palmeiras are also reportedly in the running for the 2002 World Cup winner, who has frequently been left on the bench at Serie A leaders Milan of late.

But Gremio have said they have agreed terms with the player and Vice President Cesar Cidade Dias added on Brazilian television Friday that the Porto Alegre club were ''optimistic'' of completing the transfer in the second half of January.

Since joining Milan in 2008, apart from the occasional flourish, Ronaldinho has never consistently reproduced the outstanding form that enabled him to win the FIFA World Player of the Year award twice while at Barcelona.

Already behind Zlatan Ibrahimovic and Robinho in the striker pecking order, if he stays he will also face competition for a place from new signing Antonio Cassano and his compatriot Alexandre Pato, who has recovered from a hamstring injury. European and Italian champions Inter Milan have already started doing business, agreeing to buy centre back Andrea Ranocchia from Genoa in a deal which will be formally completed when the transfer window opens next week.

Chairman Massimo Moratti joked earlier this week that they will now be able to make five or six more signings in January after parting company last week with coach Rafa Benitez and his big salary.

Inter have brought in former Milan boss Leonardo after falling 13 points off the pace in Serie A in their short spell under Benitez.

Lazio, who share second place with Napoli, have been linked to Manchester United's Federico Macheda after manager Alex Ferguson gave his OK to a loan move for the Italy Under 21 forward to enable him to get regular first-team action.

The 19-year-old knows the Rome club well having come through their academy, although Parma and Fiorentina are also reportedly interested in signing him. Lazio have been linked to Bayern Munich's Germany forward Miroslav Klose too, but their hopes of landing Manchester City's Roque Santa Cruz look to be over after the Paraguay striker turned down a loan, saying he wanted a permanent deal.

Fourth-placed Juventus have not given up hope of landing Wolfsburg's Bosnia striker Edin Dzeko, even though he is reportedly close to moving to Manchester City, and have their sights set on Fiorentina's Italy forward Alberto Gilardino for June.

Brazilian offensive player Julio Baptista looks likely to leave last season's runners-up AS Roma, who are fifth, and join top-flight Spanish club Malaga when the transfer window opens.