Towers said Monday night that he has facilitated a three-team and possibly a four-team deal that would send Peavy to Chicago for a package of players.
"There's a package there that will satisfy us. ... There's a deal in the way of names," said Towers, who carefully stated that no deal, even in principle, has been reached.
Towers, who had a discussion with Hendry earlier Monday, said he had been in contact with a third and a fourth team -- believed to be the Orioles and Phillies -- and has gotten both sides to agree to the players who could be moved in a deal.
Towers did say there might be some "haggling" over the players the Padres would get in return from the Cubs. Towers said a third team would be a must if the trade is indeed to go down.
According to a Major League source, the Phillies are exploring "every option" to try to improve their pitching staff.
Ruben Amaro Jr., the Phillies' new general manager, declined to comment about the possibility of being involved in a Peavy trade, although a source said talks are only in their preliminary stages.
The Padres are looking for Major League-ready pitching in return for Peavy, whether it be from the Cubs or the other teams involved -- one to replace Peavy in the rotation and to help fill a bullpen that struggled mightily in 2008.
Towers said a deal "could happen quick" if the Cubs agree to assume not only Peavy's $11 million salary in 2009 but the remainder of the $63 million that he is owed over the next four seasons.
According to CBSSports.com, the Padres could receive a package of 20-year-old third-base prospect Josh Vitters and pitchers Kevin Hart and Jason Marquis. Marquis will earn $9.875 million next season, which means the Padres might need the Cubs to assume part of the salary in such a deal.
The CBSSports.com report also said the Padres would end up with left-handed pitcher J.A. Happ and catcher Chris Coste. San Diego is looking for a backup catcher and Coste would certainly fill that void.
If the Orioles are involved, the Padres could land left-handed pitcher Garrett Olson, a player who has been linked to San Diego in the last month.
Earlier Monday, Towers said that he's essentially dealing with just one team for Peavy and that if a deal cannot be struck at the Winter Meetings, he will effectively pull Peavy off the trading block.
"It's the one ballclub we're talking to; there's no secret there," Towers said of the Cubs.
But Towers said that if a deal can't be consummated by the time he leaves Las Vegas on Thursday, he will, for the sake of the team, the fans and even Peavy himself, take him off the market and he'll be the Opening Day starter on April 6.
He later backpedaled some on that statement, saying there's no hard-and-fast deadline.
"My hope is that by Thursday, there's a deal to be had. If we haven't made progress, if it is not going to work out, we need to move on," Towers said. "If we weren't to make any progress in the next two to three days, we would likely come out and make a statement that he's going to stay."
According to Towers, Peavy, who has a no-trade clause, has indicated he would accept a trade to play in Chicago and that the Cubs would have no issues with his contract.
The Padres, who are looking at a $40 million payroll next season, would like to hang onto the 27-year-old but it's not entirely cost-effective. The trade last week of shortstop Khalil Greene and the $6.5 million he'll make in 2009 to the St. Louis Cardinals gave San Diego some wiggle room to retain Peavy, Towers said.
Not being able to move Peavy has prevented Towers from making other moves to help a team that lost 99 games in 2008.
"I don't want to go into Christmas with so many holes and still working on this," Towers said.
Corey Brock is a reporter for MLB.com. This story was not subject to the approval of Major League Baseball or its clubs.