PA PhotosJoe Cole failed to make a positive impression at Liverpool
Cole, 31, has started only nine Premier League games since he signed for Liverpool from Chelsea in the summer of 2010, with the player sent out on loan to Lille last season.
Having begun his career at West Ham, the Englishman appears set to return to Upton Park as the Hammers aim to seal a deal before midday on Friday ahead of Saturday's FA Cup tie with Manchester United.
It is understood that Liverpool would pay Cole a negotiated settlement in order to get his estimated £100,000-a-week salary off the wage bill and West Ham owner David Gold's son Jack seemed to confirm the deal on Thursday when he tweeted: "Joe cole is now a #whu player ones again #hammercominghome."
Benayoun, meanwhile, has returned to Chelsea, having joined West Ham on loan at the start of the season only to see the switch plagued by injuries.
"West Ham United can confirm that the loan of @YossiBenayoun15 has ended and he has returned to @chelseafc," a statement on West Ham's Twitter feed read.
"The club would like to thank Yossi for his efforts during his second spell with the Hammers and wish him the best of luck for his future career."
Benayoun made six appearances under Sam Allardyce during his second spell at Upton Park, having previously been with the club from 2005 to 2007.
Information from the Press Association was used in this report.
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