Steve Coppell said a "serious" bid had been made and was under consideration, and rumours were flying on Tyneside after Kevin Keegan said he was closing in on a left-back.
Shorey had been expected to leave Reading since their relegation last season, with a number of clubs reportedly interested in his services.
Newcastle Did Not Make That Bid!
Martin O'Neill: "Strengthening the squad has obviously been in our minds for quite some considerable time.
"Obviously the injury to 'Freddie' (Bouma) has left a gaping hole on the left. 'Freddie' had a wonderful season for us last year, and this wasn't necessarily a priority for us before the injury.
"But Nicky Shorey is more than a back-up. He's a quality player on the ball and is up for the challenge."
Shorey: "It's all come out of the blue a bit, but it's a great challenge for me. This is a massive club, and I'm really looking forward to it.
"There were other clubs interested, but this is such a big club. Obviously I talked to the manager, and he's very positive and very ambitious. That's what I am, - especially after last season. I want to get back into the Premier League and show people what I can do.
"When you talk to the manager you want to get a good feel for what he's trying to do, and I did straightaway with Martin. He made me feel at ease and made me feel wanted. That was a big factor."