"There were a lot of teams involved," Penny told WEEI.com Sunday. "But I wanted to go somewhere where I knew we had a great chance at winning and Boston is that place."
The Red Sox don't comment on free-agent signings until they are official. Initial efforts to reach Greg Genske, Penny's agent, were unsuccessful.
News of Penny's pending agreement with the Red Sox was first reported by FoxSports.com. Along with his base salary, Penny could earn an additional $3 million in performance bonuses with the Red Sox.
After monitoring the CC Sabathia and A.J. Burnett sweepstakes, the Red Sox took a pass while those two players signed mammoth contracts with the Yankees.
Derek Lowe, who is still on the market, also drew interest from the Red Sox, but was believed to be out of Boston's price range.
Penny, coming off an injury-plagued 2008, could solidify a rotation that already includes Josh Beckett, Jon Lester, Daisuke Matsuzaka and Tim Wakefield. Young pitchers Clay Buchholz and Justin Masterson will also be in the mix for a spot in Spring Training, though the latter could very well stay in the bullpen, where he was dominant during his rookie year.
After posting back-to-back 16-win seasons with the Dodgers in 2006-07, Penny slipped to 6-9 with a 6.27 ERA in 19 appearances in 2008. Because of shoulder issues, Penny pitched just four times after June 14. He did not require surgery.
Perhaps John Farrell, one of the most highly regarded pitching coaches in the game, could help Penny round back into form.
Penny became a free agent after the Dodgers gave him a $2 million buyout rather than picking up his $9.25 million option.
By coming to Boston, Penny would be reunited with Beckett and third baseman Mike Lowell, two players he won a World Series championship with in 2003 with the Marlins.
Penny, 30, is 94-75 in his career with a 4.06 ERA and 1,032 strikeouts. He has spent his entire career in the National League.