Goal have reported that the City Blues have set aside €26 million for the midfield playmaker despite his recent knee injury.
Gundogan has been ruled out of Euro 2016 and the beginning of next season after dislocating his knee during training earlier this month. The German newspaper Bild report that it will take Gundogan four to six months for him to make a full recovery.
The Injury put his proposed move to the Premier League in doubt and caused Dortmund to postpone contract negotiations.
However, Goal goes onto state that personal terms are already close to being agreed after Gundogan’s agent was pictured meeting City sporting director Txiki Begiristain back in March.
Gundogan has seven assists and three goals in 40 appearances for Dortmund this season.