Manchester City are set to part with Matija Nastasic for around £10 million, with Schalke 04 considered the favourites to sign him up, as reported by The Guardian.

The German side will have to hold off interest from AC Milan to secure his signature, however.

Despite being highly rated by former City manager Roberto Mancini, Nastasic has never really received opportunities under Manuel Pellegrini, with the Chilean manager believing that Dedryck Boyata is a far better prospect going forward.

This comes as a shock, with Nastasic having been nearly voted player of the year by City fans two seasons ago while Mancini was in charge.

Boyata has been out on loan twice too, but Nastasic is still behind him in the pecking order.

This puts him fifth choice for a central defensive berth at the club.

As a result, he anticipates a move to Schalke, who are managed by former Chelsea boss Roberto Di Matteo, during the January window.