Ronaldinho to sign for AC Milan
Manchester City have lost out to Italian side AC Milan in the race to sign Barcelona playmaker Ronaldinho.
"AC Milan and Barcelona have reached an agreement in principle over the transfer of Ronaldinho," the Serie A club said on their website.
"The player will be in Milan on Wednesday to undergo a medical and sign a contract that will keep him at Milan until 30 June 2011."
City had reportedly bid £25.5m for the 28-year-old Brazilian.
Manchester City boss Mark Hughes says his disappointment at missing out on Ronaldinho is eased by the club's show of ambition.
And he insists Ronaldinho's decision to join Milan will not halt his search for stars as he said: "We have presented our case as well as we possibly could and the fact that we are in there trying to get one of the top players in the world shows our ambition and where we want to go.
"I don't know the finer details of the negotiations, but the way the Ronaldinho deal was constructed was a little bit different by all accounts to an ordinary deal, so my budget would not have been affected as much as people think."
Reports suggest that Ronaldinho's negotiating team were ultimately uinimpressed by a financial package from City that was heavily weighted with clauses relating to performance, success and marketing.
Hughes added: "Obviously, I am being linked with players that I know and possibly have worked with before and then there are others that agents are trying to move on and place.
"There is a lot of that going on at the moment. It is not my way to divulge who were are going after.
"I will keep them under wraps in case someone jumps in at the last moment, but there is a lot of work going on behind the scenes."
Italian newspaper Gazzetta dello Sport reported on its website that Milan will pay Spanish side Barcelona just £14.6m for his services, with the figure likely to be increased by performance-related bonuses.
Milan chief executive Adriano Galliani has been in Barcelona for talks with the club and the player for two days.
The two-time Fifa World Player of the Year's time at Barcelona effectively came to an end in June when new manager Pep Guardiola announced the playmaker was surplus to requirements.
Ronaldinho helped Barcelona win back-to-back Spanish league titles (2004-05, 2005-06) and the Champions League in 2006, but failed to cement a regular place in the starting XI last season because of injury and fitness issues.
