Manchester City and Roma are said to be locked in a battle to sign long-term Liverpool target and current Real Madrid midfielder Fernando Gago according to talkSPORT.
The 25-year-old has fallen well down the pecking order at the Bernabeu, having started only 15 games for Los Blancos in the last two seasons.
Citizens boss Roberto Mancini is keen to add the all-action Argentina international to his Etihad Stadium squad, following up the recent arrival of Samir Nasri with another marquee signing.
City failed in an attempt to sign Gago in January 2010, after the Barclays Premier League side were unable to agree a fee - believed to be in excess of £20million, with the La Liga giants.
Liverpool are another club who have been credited with a long-term interest in Gago, with Reds boss Kenny Dalglish having reportedly considered a renewed bid to bring him to Anfield this summer.
But having replenished their midfield ranks on Merseyside with the addition of Jordan Henderson, Charlie Adam, and Stewart Downing already this transfer window, it is unclear whether or not Liverpool still hold a genuine interest.
Sources in Spain suggest that Real will now be willing to sell Gaga for around £8.5million, but are refusing to let the defensive midfielder leave on loan - having already turned down an offer from Serie A side Roma.
The Italian's are likely to come back in with a cash offer, and so could prove to be City's main competition over Liverpool for the South American star.
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