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Pep Guardiola will not rival Manchester United for the signature of Renato Sanches after Manchester City opted against a move for the Benfica midfielder.

It is understood the £40m-rated 18-year-old is highly thought of at City.

But incoming manager Guardiola will pursue other midfield targets instead, with Ilkay Gundogan, Paul Pogba and Toni Kroos on his radar.

That leaves United out in front in the race to land one of the most exciting prospects in European football - with Old Trafford’s hierarchy confident a deal is imminent.

It also suggests City believe they will be successful in their pursuit of other names on Guardiola’s midfield wishlist.

It is anticipated Gundogan will arrive in a deal worth between £14m-19m after City director of football Txiki Begiristain was spotted with the German international’s agent in an Amsterdam hotel last month.

More: Who is Renato Sanches?

Interest in Pogba remains - but City are wary of the experiences of last summer when they eventually had to abandon a move for the France star due to a combination of Juventus’ £71m valuation and the player’s personal demands.

Guardiola is also keen on a reunion with Kroos, who left Bayern Munich for Real Madrid in 2014.

City’s hierarchy have guaranteed their next manager the funds to bring in some of the world’s top talent.

His obsession with midfielders is well documented, so it is little surprise he took a close look at Sanches, who is represented by super agent Jorge Mendes.

He will have studied him in Bayern’s recent Champions League quarter final against Benfica, but ultimately instructed Begiristain and City chief executive Ferran Soriano not to go head-to-head with United.

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