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Pep Guardiola has ended his interest in

after judging Southampton’s £60m valuation unrealistic.

Van Dijk was among Manchester City's top central defensive targets - but their pursuit never reached the stage of submitting a formal bid.

And after being informed of Southampton’s asking price - and Liverpool’s willingness to make the Dutchman the most expensive defender of all time, they opted to pull out of the race.

Jurgen Klopp will make Van Dijk a club record signing when the deal goes through once the transfer window opens next month.

But the belief among City’s hierarchy is that the Anfield club are paying above the odds for a player with little experience at the highest level.

City paid £47.5m for John Stones last summer - but it is accepted homegrown players come at a premium.

Liverpool’s record of signing players from Southampton - with Adam Lallana, Nathaniel Clyne, Dejan Lovren and Sadio Mane moving in recent seasons - is also seen as handing them an advantage during negotiations.

Sources close to Van Dijk had claimed he would relish the chance to work with Guardiola.

But City’s refusal to enter an auction for the 25-year-old brings an end to their pursuit.

Central defence remains an area in need of address - and Guardiola’s interest in Van Dijk is evidence of his intention to recruit a centre back this summer.

But priorities remain in the full back positions, with Vincent Kompany’s return to fitness and form at the end of the season, proving an immense source of encouragement for the City manager.

Leonardo Bonucci is a long-term target - and the Italian international could be convinced to make the move 12 months after Guardiola tried and failed to prise him away from Juventus in his first transfer window at the Etihad.

A major summer of recruitment is well underway at the Etihad with £43m Bernardo Silva Guardiola’s first signing.

Ederson will complete his £34.7m move from Benfica once issues over the Brazilian goalkeeper’s third party ownership are resolved.

Alexis Sanchez is Guardiola’s first choice strike target, while Kyle Walker and Benjamin Mendy are wanted in the full back positions.

Ryan Bertrand has belatedly emerged as an alternative option as City and Monaco continue to haggle over the French champions’ £40m valuation of Mendy.

Guardiola could still add a holding midfielder, although that is not a priority in this window.