Man City pull out of Alexis Sanchez sweepstakes
Pep Guardiola held talks on Monday with City hierarchy -- Chairman Khaldoon al Mubarak, chief executive Ferran Soriano and director of football Txiki Begiristain -- and all agreed to decide to end the pursuit of Sanchez, the sources said.
Manchester United now appear to be favorites to sign the 29-year-old Chilean, though sources say his agent has now opened talks with other clubs.
Arsenal are believed to want around €45 million for Sanchez, who is out of contract at the end of the season.
City were close to signing him on deadline day in August, until the Gunners pulled the plug on a €70 million deal when their plans to sign a replacement fell through.
But sources said they now consider the package being demanded means he could end up costing more than that the deal agreed in the summer.