Seven-time Formula One World Drivers' champion Lewis Hamilton is willing to accept a one-year contract that includes an option to extend it by another year to 2022 offered by Mercedes-AMG Petronas F1 Team, reported Daily Express on Thursday.

Meanwhile, former world champion Damon Hill broke on Twitter that Hamilton is signing a two-year deal with the team which will also give him a veto on his teammate.

Last year, Hamilton won his seventh world title in the Turkish Grand Prix but his contract with Mercedes also came to an end in 2020. The two sides have been negotiating on a new deal but not much progress was made. There were reports claiming that Hamilton and Mercedes could not agree on many details.

The 2021 Formula One season is scheduled to begin in Melbourne on March 21, which is not far away and pressing Mercedes to complete their roster soon.

"We have a good relationship which is not only professional but also a friendship," said Mercedes boss Toto Wolff to RTL Sport. "Lewis is incredibly important, not only for our team but also for the Mercedes brand."

"But the landscape is changing right now. We have a big regulation change next year and the cost cap that will hit us hard next year. These are all factors that have played a role in our discussions. Also, of course, looking at the future. And then it goes into detail and we don't want to be put under pressure. It should be a reasonable agreement and we are not far away from that."

Hamilton moved from McLaren to Mercedes in 2013 and won six world titles in the following seven years. He already surpassed German legend Michael Schumacher in most race wins (95), most pole positions (98) and most podium finishes (165). Hamilton's next goal will be the record eight world champion.