Sidwell's future at Reading has been the subject of intense speculation all season after he turned down a new deal last summer.
The 24-year-old's current contract expires at the end of the season and he is keen to wait until the summer before making a decision on his future.
Reading are desperate to keep their star midfielder and have been locked in talks with Sidwell for some time over a new deal.
The Royals are now thought to have offered Sidwell a bumper new deal - the most lucrative in the club's history - in an attempt to persuade him to stay.
Sidwell has impressed for Reading this season as they have adapted to life in the Premiership with ease.
A number of clubs are keeping tabs on Sidwell's situation at The Madejski Stadium as they line up moves to sign him.
The likes of Newcastle, Everton, Aston Villa, Manchester City and Bolton are believed to be weighing up bids to sign the former Arsenal youngster.
Sidwell is expected to wait until the end of the season before revealing his plans for the future.
The dynamic midfielder is adamant any decision on his future will not come to money and that he just wants to fulfil his ambitions of trying to break into the England set-up.
SkySports