Your move, Theo? From the New York Daily News’ Bill Madden and John Harper :

After two days of internal discussions among front-office executives, the Yankees swallowed hard Friday and decided to offer Phil Hughes to the Twins as part of the trade package they hope will land them Johan Santana.

The Yanks had declared Joba Chamberlain off limits, and the Twins told them that Ian Kennedy, the third of their three prized righthanders, wouldn’t be enough. According to the club source, there was spirited internal debate in the organization via conference calls about whether to make Hughes available.

In any case, the club finally agreed to put Hughes in a package that includes center fielder Melky Cabrera and at least one other lesser pitching prospect still to be negotiated, as of Friday night. And by doing so they believe they are the front-runners to land Santana, the two-time Cy Young winner.

There had been speculation the Red Sox were closing in on a deal on Thursday, but Yankee executives don’t believe there was much to the rumors. And sources Friday said the Twins won’t consider a deal with the Sox unless they include two of their big three prospects, pitchers Jon Lester and Clay Buchholz, and center fielder Jacoby Ellsbury.

The Sox apparently have told the Twins they won’t do that, including only Lester among those three as part of a four-player proposal on Thursday.

Likewise, the Twins told the Dodgers they had to have two of their top three young players – James Loney, Clayton Kershaw and Jonathan Broxton. The Dodgers, however, apparently have fallen out of the race because of the cost it will take to sign Santana to a contract extension.