Malawian Phiri spent last season on loan at Platinum Stars, who have been relegated to the National First Division.
According to a source, Wits have also shown interest in Sundowns winger Anthony Laffor.
"Sundowns have forwarded the proposal to Wits. They want to sign Phiri," says the informant.
"Wits are interested in signing Laffor from Sundowns.
"However, Downs are reported to have proposed to send Malajila to Wits as part of the swap deal."
The Brazilians have already added Bafana Bafana ace Andile Jali and Guinea Bissau international Toni Silva to their roster for the coming season.
However, they have lost Khama Billiat to Kaizer Chiefs, while fellow star attacker Percy Tau's future is uncertain at Chloorkop amid offers from abroad.