Man United are attempting to make a late move to sign Kevin De Bruyne amid reports that Wolfsburg are ready to accept a £50m bid from Man City.
City have been chasing the 24-year-old's signature for most of the transfer window and just as it looked like they would get their man, the Daily Star reports United are set to offer an increased £55m for De Bruyne.
Louis Van Gaal has conceded any deals to bring Gareth Bale, Thomas Muller or Neymar to the club are unlikely to be completed this summer, and has now switched his attention to De Bruyne to complete a marquee attacking signing before the transfer window closes.
If a deal could be completed, it would serve as some transfer redemption for Louis Van Gaal. The Dutchman lost Pedro to Chelsea after agreeing personal terms with the winger, while City also beat him to the signing of Nicolas Otamendi.
Any move for the Belgium international would likely see United and City go head to head for his signature up until the closure of the transfer window next week.
Here's the rest of Tuesday's transfer gossip:
Manchester United are willing to pay an astronomical £240m between a transfer fee and wages to sign Barcelona striker Neymar.
Karim Benzema has put an end to speculation linking him with a move to Arsenal as he posted on Twitter saying he is staying at "his home" Real Madrid.
Arsenal are stepping up their interest in PSG striker Edison Cavani after Benzema committed his future to Real.
Chelsea are planning a £70m bid to lure Juventus' 22-year-old midfielder Paul Pogba to Stamford Bridge.
Everton's 22-year-old star defender John Stones is considering handing in a transfer request to force through a potential £40m move to Chelsea.
Bayern Munich are considering entering the race for Manchester City target Kevin De Bruyne and are willing to wait till next summer to sign the 24-year-old from Wolfsburg, which could swing the deal in their favour.
West Brom are considering a deal to bring Manchester United defender Jonny Evans to The Hawthorn's after telling Joleon Lescott he can leave the club.
West Ham manager Slavin Bilic wants to sign a winger and is considering deals for Spurs' Aaron Lennon, Chelsea's Victor Moses and Manchester United's Adnan Januzaj.
West Ham could also sign 31-year-old striker Emmanuel Adebayor on loan after Spurs agreed to subsidise the Togo international's £100,000 per week wages.
Sunderland and Bournemouth are competing to sign 27-year-old former Swansea midfielder Jonathan De Guzman from Napoli.