Manchester City have dismissed Real Madrid's claims that they were to blame for the failed deadline-day attempt to sign Fernando Gago. The 23-year-old Argentina international was one of Roberto Mancini's primary targets but the £15.7m deal had to be called off after the clubs ran out of time to process the ­transfer before the 5pm cut-off point.

Madrid have blamed City's chief executive, Garry Cook, for not being fully prepared and said the delay was caused partly by the need to get a formal go-ahead from the City owner, Sheikh Mansour bin Zayed al-Nahyan. "They had nothing prepared, not even one document signed," Jorge Valdano, Madrid's sporting director, told the El País newspaper. "They had not reached an agreement with the player and they would have had to have done everything in 40 minutes."

City are reluctant to be drawn into a verbal battle with the Spanish club, a legacy in part of the war of words with Milan following the infamous attempt to sign Kaká, and have decided not to speak out publicly. Privately, however, Cook and his colleagues are taken aback by Valdano's remarks and believe the deal could have gone through without any complications had Madrid not initially overpriced the player.

The first contact between the two clubs was made in early January when Madrid quoted a fee of £21m and informed City they would not budge. After being unable to persuade them to lower that valuation, City switched their attention to McDonald Mariga, Palma's Kenyan midfielder, reaching an agreement over his fee and salary only to learn on Monday that they could not get a work permit for him. Cook then returned to Madrid to check whether Real's stance had altered and was informed Gago's valuation had dropped by £4.3m.

With only a few hours to go before the transfer window closed, Cook suggested the only way to complete everything was to sign a loan deal with a clause that a permanent transfer be concluded in the summer, but Madrid were unhappy with that idea and, say City sources, seemed to expect that personal terms would already have been agreed with Gago. Cook informed Madrid that to have done so would have constituted an illegal approach.

Gago spent most of the day waiting for developments in a hotel and his agent, Marcelo Lombilla, was unimpressed by Cook's handling of the transfer. "City used us," Lombilla told the radio station Onda Cero. "This has never happened to me before. I don't want to talk about the figures that City were offering because they approached Madrid without even knowing there wasn't physically enough time to put something together."

The failure to land Gago concluded a mixed transfer window for Mancini, who completed a £7m move for Middlesbrough's Adam Johnson and also brought Patrick Vieira, the former Arsenal captain, back to English football from Internazionale, while Robinho moved to Santos on loan and talks for the Roma defender Marco Motta broke down.

Mariga ended up moving to Internazionale after not getting Home Office clearance despite a personal appeal from the Kenyan prime minister, Raila Odinga, to Gordon Brown and the Football Association's chairman Lord Triesman. "I spent a minimum of three hours on the phone talking to Gordon Brown's office, the Africa Office, the Office of Culture and Sports, the Home Office, and to Mariga himself," Odinga said.