Delany is expected to be confirmed as an injury replacement for the Highlanders in the next day or two.
The Otago Daily Times understands he may be available for the game against the Stormers at Forsyth Barr Stadium on Saturday.
The former All Black first five will provide crucial cover in a position where Chris Noakes is the last man standing following season-ending injuries to Colin Slade (broken leg) and Lima Sopoaga (shoulder).
Delany (29) returns to the Highlanders after spending a season with the franchise in 2008 under the old draft system.
He was later retained by the Chiefs - Delany was a Bay of Plenty player at the time - and showed such good form he was picked for an All Black tour, earning one test cap against Italy.
It was something of a surprise when he decided to chase the yen a couple of years later.
Delany has been playing for the Panasonic Wild Knights, where he came under the wing of assistant coach Tony Brown, now the Otago coach.
Highlanders coach Jamie Joseph said he could not confirm the signing yet but acknowledged Delany was "the guy we're after".
"We've been talking to him and he's keen to join us," Joseph said yesterday.
"There's just a few wee contractual things to sort out. Hopefully, we can sort it out soon."
It was a big ask for Noakes to shoulder the playmaking responsibilities on his own, Joseph said.
Delany was a quality player who would be an excellent addition to the Highlanders, he said.
Joseph's squad is still depleted, with Slade and Sopoaga gone, Nick Crosswell out for another five weeks with his knee injury, and midfield backs Kenny Lynn (neck) and Siale Piutau (ankle) still far from ready.
But lock Jarrad Hoeata got through his comeback game, the 43-12 thumping of the Rebels in Invercargill on Friday night, with no problems, and hooker Andrew Hore should be able to train this week.
Meanwhile, Rebels winger Cooper Vuna has been suspended for two weeks for making a dangerous tackle during his side's loss to the Highlanders in Invercargill.
Vuna pleaded guilty to lifting a player from the ground and dropping or driving that player into the ground, after he was cited for his dangerous tackle on Highlanders winger Kade Poki.
