Carlo Ancelotti has told Paris Saint-Germain he is determined to join Real Madrid, but the French club are digging their heels in over his reported €7.5 million release clause, according to reports.
Spanish newspaper AS reported on Friday that, although the sum involved is not important to mega-rich PSG, they are determined not to back down and will hold their coach to the terms of his contract, which has another year to run.
The nine-month ban imposed on PSG sporting director Leonardo for pushing a referee, and departing Bayern Munich coach Jupp Heynckes deciding not to return to football next season, have complicated the situation for both Madrid and PSG.
Laurent Blanc could take over at the Parc des Princes, but that option is not seen as ideal and reports continue to suggest that Ancelotti is close to completing a move.
Madrid president Florentino Perez, criticised in Spain for spending millions to secure previous coaches Jose Mourinho and Manuel Pellegrini, would prefer it if Ancelotti negotiated his own exit.
Marca has suggested that PSG would accept €4 million - with the Italian and Madrid contributing €2 million each - and a deal could be done at the weekend, allowing him to "fulfill his dream" of becoming Madrid boss on his 54th birthday next Monday.
Meanwhile, Arrigo Sacchi, who was sporting director at Madrid under Perez in 2004-05, has told AS he believes Ancelotti would be a good fit at the Bernabeu.
"His major quality is that he is like a chameleon," Sacchi said. "He plays different styles depending on the players that he finds himself with.
"If you want to make a team like a rock and you sign players who are slow in the legs, your work will become difficult. But he has the ability to adapt himself. Carlo is a great person. A really nice guy."
Ancelotti played for Sacchi as he won one Serie A title and two European Cups during four years at AC Milan.
Sacchi said Diego Maradona had been impressed with the way in which Ancelotti had used his tactical intuition and reading of the play to control games from midfield.
"He was a very generous player, with a great tactical capacity, with personality, character and professionalism," he said.
"Maradona told me once: 'Arrigo, now with you, even Ancelotti runs quickly.' I told him: 'He does not run quickly, he thinks quickly.'"