Chelsea midfielder Mateo Kovacic has agreed personal terms with Manchester City, according to reports.
The Croatia international is out of contract next year and Chelsea are keen to offload players who have 12 months remaining on their deal instead of seeing them leave on a free transfer next summer.
Mail Sport revealed Man City were given permission by Chelsea to hold talks with Kovacic over a move.
And according to Fabrizio Romano, the Premier League champions have now agreed a contract with the Chelsea midfielder.
The clubs will now discuss a fee after the Champions League final.
Kovacic confirmed on Thursday he is ready to 'change environment' and leave Chelsea this summer after enduring a 'really bad season' at Stamford Bridge.
Speaking ahead of Croatia's Nations League semi-final against the Netherlands next week, the 29-year-old midfielder admitted he is very likely to leave the west London club this summer, with only one year left on his current Blues deal.
Kovacic also took the opportunity to heap praise on Manchester City, labelling Pep Guardiola's Treble-chasers a 'top team', amid talk of a potential move to the Etihad.
City will be in the market for a new midfielder if they are unable to extend Ilkay Gundogan's deal, with their out-of-contract captain attracting interest from Barcelona, Arsenal and and a handful of Saudi Arabian outfits.
Kovacic is expected to join the Premier League and FA Cup champions next season, having impressed Guardiola during his time at Real Madrid and Chelsea.
'I have one year left on my contract with Chelsea. It's been a really bad season,' the midfielder admitted.
'Everything indicates that after five years I will change the environment , but we will see what happens.'
Ahead of City's Champions League final against his old club Inter Milan on Saturday, which could secure English football's first Treble since 1999, Kovacic added: 'Manchester City is a top team and deserves to be in the Champions League final.
'That's what I have to say. The summer is long, we'll see what happens in the future.'
The Croat made 37 appearances for Chelsea across all competitions this season, scoring once and providing two assists in a turbulent campaign at Stamford Bridge.
Struggling to carve out positive results under Thomas Tuchel, Graham Potter and interim manager Frank Lampard, the Blues finished the Premier League season in 12th, a staggering 27 points off fourth place.
New boss Mauricio Pochettino will hope to recover Chelsea's form after a hefty summer rebuild in west London, attempting to gel the glut of new additions signed during Todd Boehly's debut season as owner.
Fellow midfielder Mason Mount is also heading towards the exit door, with Manchester United and Liverpool both fighting for his signature, although it is understood Pochettino wants to keep the England star among his ranks.
Dembdnsu
543
pep knows who to buy for his team, you can't tell him , as far as i'm concern pep doesn't buy a player who has won UCL trophy already, he buys players who are hungry to win the trophy
Rizannasir
373
welcome to the biggest club in football
Rj13
143
Kovacic is bigger than the whole city team He has UCL, Europa, club world cup