The report claims that City have already agreed terms with the Dortmund star and that a deal has been struck behind closed doors.
City sporting director Txiki Begiristain has already met with Gundogan’s uncle and agent Ilhan Gundogan regarding a summer deal.
Ilhan Gundogan who represents the Dortmund midfielder does however, maintain that no deal has yet been reached with City.
“It is not true [that it is a done deal],” the agent is quoted as saying by Bild.
“There is no decision and everything is still open. Ilkay is focusing further on his recovery.”
The 24-year-old’s current contract with Dortmund expires in June but he is reported to have refused to sign a new deal in order to push through a summer transfer.
Premier League giants Arsenal and Italian champions Juventus are also reported to be in the race for Gundogan.