Manchester City are closing in on a summer deal for Saul Niguez after moving ahead of Barcelona in the race to sign the Atletico Madrid midfielder, sources have told ESPN FC.

City manager Pep Guardiola has identified Saul, 24, as a long term replacement for Fernandinho, having failed to beat Barcelona to the signing of first choice Frenkie de Jong from Ajax. De Jong rejected interest from City and Paris Saint-German in January to sign a pre-contract agreement with Barca ahead of a €75m summer move to Camp Nou.

Despite capturing the highly-rated Netherlands international, Barcelona have also tracked Saul as they attempt to reduce the average age of Ernesto Valverde's squad. But sources have told ESPN FC that Barca have been made aware of City already making firm steps to seal a deal for the Spain midfielder.

Saul's representatives have been in contact with Barcelona for the last few months. "He can't stay at Atletico anymore, everything's complicated for him there," a source told ESPN FC.

Now, 10 points behind the leaders in La Liga and out of the Champions League and Copa del Rey, the midfielder doesn't see a future at the Wanda Metropolitano.

Barca have been fans of Saul's versatility for a long time. When they sold David Villa to Atletico in 2013, president Josep Maria Bartomeu ensured the deal included a first option on three players: Saul, Koke and right-back Javier Manquillo (now at Newcastle).

Saul had been open to a move to Barcelona but his people have now informed the Catalan club his final destination will be Manchester.

Atletico's elimination from the Champions League last week, suffering a 3-2 aggregate defeat against Juventus, has raised doubts over the futures of several key players at the Wanda Metropolitano.

Sources said that Atletico will need to raise funds in the summer through player sales, prompting Barca to pursue Saul. While Atletico are eager to hold out for around €120m, sources said a fee of €80m would be enough to finalise a transfer.

With City spending almost two years searching for a replacement for Brazil international Fernandinho, who will be 34 in May, they are now set to win the race for Saul at the end of this season.

As well as missing out on De Jong, City have also seen previous targets Fred and Jorginho move elsewhere, to Manchester United and Chelsea respectively.

Speaking about his Atletico teammate while on international duty with Spain, Chelsea's on-loan striker Alvaro Morata said: "The market is always like that. In every window big-name players are linked to top clubs.

"Saul is one of the best players in his position and he is also young. There's no doubt that anyone would be interested in having him. We are lucky to have him. I hope he stays because he is an asset to Atletico and he is a great person. We need him to stay."

ESPN's Barcelona correspondent Sam Marsden also contributed to this report.