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ESPN FC  By ESPN staff

Manchester City pull out of race for Arsenal attacker Alexis Sanchez

The transfer window is heating up! Transfer Talk brings you live updates on all the latest rumours and done deals. Check out all the confirmed January moves so far on our transfers page.

TOP STORY: Man City pull out of race for Alexis

After his summer move to Manchester City broke down at the 11th hour, Alexis Sanchez seemed destined to wind up at the Etihad either this month or in the summer. Now, though, sources have told ESPN FC that City have pulled out of the race to sign the Arsenal forward.

The Premier League leaders abandoned their pursuit of the 29-year-old for financial reasons. According to sources, the deal to pry Alexis from Arsenal this month -- including the £35 million transfer fee, wages and other add-ons -- would cost City more than the package they put forth in the summer, which included a £55m bid.

Manchester United are now expected to be the likely destination for the Chile international, although sources have said that his agent has opened up talks with other clubs.

LIVE BLOG

22.25 GMT: That's going to do it for Monday's live edition of Transfer Talk. Thanks very much for joining us, and be sure to check back in a few short hours when we return with the latest gossip plucked from Tuesday morning's back pages.

22.20 GMT: Riyad Mahrez could be worth £100 million in the summer, according to Leicester boss Claude Puel. Read the full story.

20.47 GMT: Sevilla are confident of securing a loan move for Chelsea striker Michy Batshuayi, sources close to the Spanish club have told ESPN FC. Read the full story.

20.14 GMT: Jose Mourinho has admitted Henrikh Mkhitaryan's absence from the Manchester United squad against Stoke is because the Armenian's future is up in the air, amid speculation he could be part of the deal to bring Alexis Sanchez to Old Trafford. Read the full story.

19.41 GMT: Arsenal are "increasingly confident" of securing a deal for Borussia Dortmund striker Pierre-Emerick Aubameyang, the Guardian reports, and adds that the North London club is edging closer to wrapping up the £40 million transfer Bordeaux attacker Malcom.

19.18 GMT: DONE DEAL -- Inter Milan have confirmed the loan signing of centre-back Lisandro Lopez from Benfica.

18.55 GMT: The Portland Timbers are interested in acquiring Columbus Crew attacker Justin Meram, MLSsoccer.com reports, after the Iraq international reportedly requested a trade earlier this month.

18.32 GMT: AC Milan will make a push this summer to sign Roma striker Edin Dzeko, Calciomercato cites Tuttosport as reporting, but the capital club will be hesitant to let go of a player who scored 29 goals in Serie A last season.

18.09 GMT: The Star reports that Manchester United are putting the finishing touches on a deal that will bring Alexis Sanchez to Old Trafford, in a package worth £40 million, including Henrikh Mkhitaryan moving to Arsenal. The report also states that the Chilean international will be paid £300,000 a week and receive a £35m signing-on fee.

17.46 GMT: Manchester United have joined Juventus and Liverpool in the chase for Cagliari midfield starlet Nicolo Barella, talkSPORT cites Corriere dello Sport as reporting. The Sardinia side reportedly will not sell the 20-year-old for less than £44 million, meaning a deal is unlikely to take place before the summer.

17.23 GMT: West Brom are lining up a £12 million bid for Fulham captain Tom Cairney, according to The Sun. The Cottagers are likely to put up a fight for the midfielder, who has helped Slavisa Jokanovic's side climb within a point of the Championship play-off spots.

17.01 GMT: Arsenal have opened talks with Borussia Dortmund over a deal for Pierre-Emerick Aubameyang, claims the Mirror. Aubameyang was dropped at the weekend for missing a team meeting and is thought to be available for £60 million. New Gunners transfer guru Sven Mislintat previously worked with the striker at Dortmund and is keen to pursue a transfer despite his recent disciplinary issues.

16.42 GMT: Orlando City have signed Paraguayan attacking midfielder Josue Colman as a designated player, the MLS club announced on Monday. The 19-year-old arrives at Orlando from Cerro Porteno in Paraguay's top flight, the same club where Atlanta United star Miguel Almiron began his career.

16.30 GMT: Arsene Wenger wants Manchester United forward Anthony Martial in part-exchange for Alexis Sanchez, reports the Evening Standard. Arsenal have been offered out-of-favour attacking midfielder Henrikh Mkhitaryan, but Wenger would prefer a deal involving Martial as he looks to shake up his forward line.

16.11 GMT: In the Championship, Sheffield United have snapped up tricky Charlton winger Ricky Holmes for an undisclosed fee.

16.06 GMT: Bournemouth are battling Everton for Arsenal outcast Theo Walcott, according to The Sun. The 28-year-old has been tipped for a £20 million move in January after failing to hold down a starting spot this season. 

15.49 GMT: Inter Milan misfit Joao Mario has rejected an escape route to Watford this month as he continues his search for regular first-team football. The midfielder moved to Italy for £36 million after starring in Portugal's Euro 2016 triumph, but has struggled to settle at the San Siro.

15.31 GMT: League One side AFC Wimbledon have signed non-league scoring sensation Joe Pigott from Maidstone United.

15.19 GMT: Arsenal are eyeing a move for Cologne goalkeeper Timo Horn as a potential long-term replacement for Petr Cech. The 24-year-old has a release clause that would allow him to leave for just £5.4 million if the Bundesliga club are relegated.

14.52 GMT: Sunderland have told £10 million midfielder Jack Rodwell he is free to leave the club. The Black Cats won't demand a fee for the 26-year-old, but Rodwell may intend to see out his £60,000-a-week contract until it expires in 2019.

14.28 GMT: Radja Nainggolan is close to finalising a move to Chinese Super League club Guangzhou Evergrande. The Belgian midfielder was previously a target for Manchester United and Chelsea, but is now heading to China in a £44 million deal that will see him earn around £10 million a year.

14.10 GMT: Have Arsenal been handed a boost in their pursuit of Borussia Dortmund striker Pierre-Emerick Aubameyang?

The striker was dropped for the Bundesliga club's draw with Wolfsburg at the weekend after missing a team meeting, with general manager Michael Zorc saying: "At some point you can't tolerate it any more. I don't know what's going on inside his head. We had a very contentious discussion today. We're not used to this behaviour from him."

14.00 GMT: Manchester United have offered Alexis Sanchez a contract that would see the forward become the highest-paid player in the Premier League if he completes his move from Arsenal.

According to Chilean outlet El Mercurio, Sanchez will receive a salary of £350,000 a week and the No.7 shirt at Old Trafford -- but there could be a spanner in the works as Henrikh Mkhitaryan remains reluctant to move to the Gunners.

13.52 GMT: Claude Puel has rubbished speculation that Riyad Mahrez will leave Leicester in January. The winger has been linked with Liverpool and Arsenal, but the Foxes boss says he's going nowhere.

"It's not a question in our mind. All the noise is just speculation," said Puel. "I have confidence in Riyad. We spoke a lot with him, [about] different things, and often about football, because he likes football a lot. He is now with good maturity, good experience of life, and we can see this in this game."

13.40 GMT: Talented Tottenham prospect Marcus Edwards has been cleared for a loan to the Championship this month by manager Mauricio Pochettino. The Guardian says Spurs will now try to find regular first-team football for the 19-year-old, who has been nicknamed "Mini Messi".

13.30 GMT: Done deal! Borussia Dortmund have snapped up FC Basel centre-back Manuel Akanji for a fee believed to be around €15 million.

13.20 GMT: Southampton may have a replacement for Virgil van Dijk lined up. Sources have told ESPN FC they are eyeing a move for Udinese's 24-year-old defender Silvan Widmer, who has been a target for Arsenal in the past.

13.04 GMT: Pep Guardiola will hold talks with the Manchester City hierarchy on Monday to make a final decision on the club's pursuit of Alexis Sanchez, sources have told ESPN FC.

The cost of the deal is likely to see City pull out of the race and leave Manchester United free to seal a £35 million transfer for the Arsenal forward. Read more here.

12.45 GMT: AC Milan say they will not entertain offers for Suso, even at a whopping €80m. The former Liverpool midfielder has established himself as a key player for the Serie A side over the past two seasons. Read more here.

12.30 GMT: Crystal Palace are closing in on £4 million-rated Ipswich goalkeeper Bartosz Bialkowski, who was left out of the Tractor Boys' team in Saturday's 1-0 win over Leeds.

12.20 GMT: Swansea are aiming to boost their Premier League survival bid with a £25 million move for Kevin Gameiro, reports The Sun. The French striker scored in Atletico Madrid's 1-0 win at Eibar over the weekend, but is thought to be available this month as Fenerbahce also monitor his situation.

12.04 GMT: Tottenham are tracking young Valenciennes defender Sikou Niakate, claims Footmercato. The 18-year-old, who only signed his first professional contract in late November, was watched by Spurs when playing for Valenciennes' reserve team last weekend.

11.51 GMT: 1 FC Cologne are closing in on Nice defender Vincent Koziello ahead of €3 million transfer. The Bundesliga basement boys hope to land the 22-year-old on a contract until 2023, according to reports in Germany.

11.40 GMT: N'Golo Kante has emerged as a top target for Paris Saint-Germain as they search for Thiago Motta's long-term successor. Le10 Sport says the Ligue 1 leaders could move for the midfielder in the summer, with Chelsea boss Antonio Conte also linked with a switch to Paris.

11.34 GMT: Done deal! That was quick -- Stoke have now confirmed Paul Lambert's appointment.

11.26 GMT: Arsenal full-back Mathieu Debuchy is in talks with Saint-Etienne over a potential switch to the Ligue 1 club, according to Telefoot. Debuchy was a loan target for Manchester United in the 2016 winter transfer window, but Arsene Wenger refused to do business with the Old Trafford club.

11:17 GMT: It looks as though there's some movement in Stoke's search to replace Mark Hughes. Telegraph reporter John Percy says the Potters are close to appointing former Aston Villa boss Paul Lambert.

11:15 GMT: Richarlison to Arsenal and Boubakary Soumare to Manchester City are two of the day's transfer rumours, according to Football Whispers.

11.12 GMT: Cristiano Ronaldo is aiming to secure a sensational return to Manchester United after falling out with Real Madrid president Florentino Perez. According to AS, Ronaldo "feels betrayed" over Perez's failure to award him an improved contract and has informed his teammates of his desire to leave.

11.03 GMT: Why aren't Chelsea in the race to sign Alexis Sanchez? ESPN FC correspondent Liam Twomey discusses the pros and cons of the Blues trying to hijack the Chilean's expected move to Manchester.

10.59 GMT: Naby Keita is almost certain to stay at RB Leipzig until the end of the season. Bild claims the Bundesliga club are demanding an additional €20 million to expedite the midfielder's move to Liverpool after he scored in Leipzig's 3-1 win over Schalke at the weekend.

10.45 GMT: Marseille have rejected a €3 million offer from Leicester City for Bouna Sarr, French outlet RMC reports. Sarr, an attacking midfielder who has been converted into a full-back by Rudi Garcia in recent months, has caught the eye of Foxes boss Claude Puel who is expected to make an improved bid.

10.28 GMT: It looks like Lucas Moura is set to leave Paris Saint-Germain. The Brazilian has made only five sub appearances in Ligue 1 this season and is thought to be a target for Manchester United -- as French football journalist Robin Bairner reports.

10.12 GMT: Villarreal striker Cedric Bakambu is still waiting for the Spanish club and Chinese Super League side Beijing Sinobo Guoan FC to finalise his €40 million transfer. "I'm between the two clubs," said Bakambu, who has nine goals in 15 La Liga games this season. "Right now, I'm still a Villarreal player. I'm waiting for the agreement between the two parties."

09.55 GMT: Tottenham have been quiet so far this month, but ESPN FC correspondent Dan Kilpatrick reports that the club are eyeing young Stevenage defender Ben Wilmot as they continue to build for the future. 

09.30 GMT: Arsenal are still pushing to sign Bordeaux forward Malcom in a €50 million deal, despite the French club's reluctance to let the Brazilian leave in January. Full story.

09.05 GMT: Arturo Vidal has been linked with a move to Chelsea, but Bayern Munich boss Jupp Heynckes is relaxed about the midfielder's future. "There's no pressure - he has a contract until 2019," said Heynckes. "If he plays well, he is either at a new club or Bayern will think about extending. I hope that he enjoys a second half to the season when we can say that is the old Vidal."

08.45 GMT: Jose Mourinho has suggested that Manchester United are ready to offer David De Gea a new contract that could keep him at the club for the rest of his career.

He said: "It's obvious that we're not going to let the option disappear. A goalkeeper like he is, and obviously a club that wants to be better and better and better, we are not going to let that year option go away.

"But obviously we are going to try. [Executive vice-chairman] Mr [Ed] Woodward is not on holiday. He barely has holidays. Of course he's going to try to give him a contract that keeps him here for much longer than that option that of course we are going to execute. Read more here.

08.20 GMT: Crystal Palace have been in great form recently and climbed away from trouble at the foot of the Premier League table, but that does not mean manager Roy Hodgson isn't keen to add new signings during the January transfer window with a striker and goalkeeper high on his wanted list.

Speaking after the impressive win against Burnley he said: "There's still only Christian Benteke [as a recognised striker]. [Bakary] Sako is doing well up there, but he was a left winger...

"We have got a goalkeeper who is doing well and another who has been a wonderful club servant but if one of them gets injured then we've only got one." Read more here.

Arsenal eye Mkhitaryan, Malcom

The future of Alexis Sanchez will be decided soon, with reports suggesting Manchester United are now a likelier destination than neighbours City.

But hold on a minute. The London Evening Standard says Arsenal "have reverted to the stance they took when City bid £60 million for Sanchez on deadline day -- that they will only sell once they have a deal in place for a replacement."

That replacement could be Bordeaux forward Malcom, according to the Standard, which reports that "his representatives were in London on Friday as Arsene Wenger confirmed he was in the market for a replacement."

The Mirror says Wenger "is prepared to lodge an opening bid of £35m for the 20-year-old" but warns that Bordeaux may ask for around £10m more.

But the Guardian reports that Arsenal are interested in Manchester United's Henrikh Mkhitaryan, who had been tipped to move to North London when he left Borussia Dortmund in 2016.

Chelsea chasing Carroll to ease goal-scoring blues

It's three successive goalless draws for Chelsea -- the first time in the club's history that has happened -- and the Stamford Bridge hierarchy believe West Ham's Andy Carroll holds the answer, according to the Guardian.

It says boss Antonio Conte is keen to augment his attacking options with Alvaro Morata struggling for goals and Eden Hazard having also endured a dip in form.

Conte would be willing to allow Michy Batshuayi to join Sevilla on loan if a replacement can be brought in, and the report says he sees Carroll, "who would be eligible for the Champions League, adding a different dimension."

But a move for the frontman would only be a short-term solution, and in any case, West Ham "would take some persuasion to part with Carroll on a six-month loan deal."

Crystal Palace close in on striking addition

These are higher-flying times for the Eagles, whose renaissance under Roy Hodgson has led them into the January window in buoyant mood.

Fiorentina's Khouma Babacar could soon be on his way in a £15m deal, the Guardian reports, with the forward having also interested both West Ham and West Brom but ready to opt for Selhurst Park.

Meanwhile, Hodgson will continue to try to land Getafe goalkeeper Vicente Guaita, although the club will not sell "despite the player saying he made an agreement with the president, which permitted him to discuss a move to suitors offering more than €4m" -- the amount reported to have been bid by Palace.

Lille central defender Ibrahim Amadou is another target for the South London side after the recent injury setback to Scott Dann.

Tap-ins

- Tottenham Hotspur midfielder Christian Eriksen is poised to sign a new contract with the club, the London Evening Standard reports.

Denmark international Eriksen's current deal expires in the summer of 2020, and the Standard says both he and Son Heung-Min are close to new terms.

- It could be a case of "if at first you don't succeed" for Hull in their efforts to sign Aberdeen defender Scott McKenna, the Hull Daily Mail reports.

It says that after having a brace of bids rejected by the Scottish Premiership club, the Tigers could return with a third offer and they have not given up on striking a deal for the 21-year-old.

- Paris Saint-Germain's Lucas Moura has admitted that his time with the Ligue 1 leaders looks to be up amid speculation that he is set for a move away from Parc des Princes in the January transfer window.

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