On the face of it, Thiago rumour is bullsh*t and doesn't make sense. Decent wad of money on an ageing player who is injury prone, and in a position which isn't high priority.
Having said that, I do think there are legs in this rumour because a lot of people are reporting it and the local journo's haven't completely shut it down.
He would be the ultimate luxury player for us. He is a world class player who is arguably the best central midfielder in the world. Works incredibly hard, wins the ball back well but his quality is on the ball. Having him in the midfield could see us perhaps evolving / changing our style next season from being reliant on full backs and centre backs getting the ball to front 3, to a style which gives the midfield more responsibility to create.