The 24-year-old has netted 24 goals in 49 league appearances for PSV since arriving from Malmo last summer, bagging a hat-trick at the weekend as PSV thrashed De Graafschap 6-0.
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Roy Hodgson's side have already been linked with a £5 million move for the Swedish international, with Liverpool's assistant boss Sammy Lee believed to have been sent to watch Toivonen on three seperate occasions over the past week.
Hodgson is thought to be keen to recruit the former Sweden under-21 star to bolster his attacking options, with Fernando Torres yet to return having picked up an injury during the World Cup in South Africa.
However, the Reds could now face competition for the Swede's signature from Premier League rivals Spurs, with Tottenham boss Harry Redknapp believed to be mulling a move for the PSV goal-getter.
The White Hart Lane supremo is desperate to add to his squad before the transfer window slams shut at the end of the month, and is thought to have targeted Sevilla striker Luis Fabiano and Nice forward Loic Remy.
Any significant movement from Spurs is not expected to be forthcoming until they secure their passage into the group phase of the Champions League, guaranteeing the club a windfall of up to £30 million.
Spurs trail 3-2 to Young Boys of Berne ahead of the second leg at White Hart Lane next week, with goals from Sebastien Bassong and Roman Pavlyuchenko keeping Tottenham's hopes alive after they had trailed 3-0 after 30 minutes.
