Real Madrid hope to close an agreement over a new deal with Pepe in the coming days.
The Portugal defender agreed terms over a new contract before leaving for international duty last week.
Pepe is expected back in Madrid today and Real hope to have contracts inked in the coming days.
The agreement will run to 2016 and sees Pepe's wages jump from €1.8 million-a-year to €3.8 million-a-year.
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