Manchester City midfielder James Milner will be out of contract at the end of the season and has been urged by City manager Manuel Pellegrini to sign an extension with the club.
The 29-year old England international has been with the club since 2010, after signing for £26 million from Aston Villa, is said to be keeping his options open.
However, there is interest from both Arsenal and Liverpool, with both keen to sign the Yorkshire man.
With Liverpool looking for to replace Steven Gerrard who is leaving Liverpool at the end of the season, and Arsenal are looking at Milner as a strong and versatile attacking player to add to their squad.
Should his contract expire at the end of the season, he will be able to sign to any club as a free transfer.
And, it is understood that the English midfielder’s demands for a four-year deal are making a renewal seem less likely.
City are only keen on offering a two-year deal with the option of a further year.
Milner has made 33 appearances in all competitions for the club, more than goalkeeper Joe Hart.