The 23-year-old Athletic Bilbao midfielder has been heavily linked with a move to the Premier League, after turning in a series of impressive performances over the past 12 months.
However, Manchester United's hopes of landing the Spaniard have been dealt a major blow after the reigning European champions emerged as contenders for his signature.
With Manchester City already weighing up a £25million offer for the box-to-box midfielder, competition for Martinez's signature will be fierce when the transfer window reopens in June.
Bilbao will be looking for closer to the £34million release clause currently written into the player's contract, after Martinez signed a new deal at San Mames at the end of last season.
The La Liga outfit will be hoping that the three-way fight will drive the transfer fee up, as the club looks to pocket a small fortune for a player who already has one World Cup winners medal to his name, prior to captaining La Roja's U21 side to European Championship glory last summer.