Bayern Munich will not activate the €70 million option to buy in the loan deal they agreed for Joao Cancelo, according to Kicker.
The Portuguese wing-back has failed to establish himself in Bavaria and will return to Manchester City this summer.
Bayern are unwilling to negotiate a reduced fee for the multi-purpose wing-back. They are bent on sending him back to his parent club.
Despite Cancelo debuting with aplomb in Germany, recording consecutive assists under former Bayern Munich boss Julian Nagelsmann, they pushed him to the side.
New boss Thomas Tuchel resumed duties with a Der Klassiker clash. He also left Cancelo on the bench for the crucial tie. It shows that the defender is surplus to requirements at the Allianz Arena.
It is unclear whether City would keep the former Juventus man at the club. They could try to sell him or look for another loan destination.
Only last season, Cancelo was the toast of the league, shining at both right and left-back roles under Pep Guardiola. He made 36 league starts and scored one goal, recording seven assists.
Cancelo was also a constant for the Spanish manager two seasons ago.
However, despite selling Oleksandr Zinchenko to Arsenal this summer, Guardiola kept dropping Cancelo. He went with Nathan Ake as a left-back despite the Dutchman being a central defender.
Even on the right, Guardiola preferred Kyle Walker and Rico Lewis ahead of Cancelo. The 28-year-old wanted game time, and Bayern Munich came calling.
The Bayern experience has not gone to plan for the former Valencia man, but he will still have suitors this summer with his fantastic abilities.
Cancelo is a superb full-back that can play on both flanks. He also thrived in the middle when Guardiola placed him there.
Although, these suitors may be wary that Cancelo fell out with Massimiliano Allegri at Juventus and Pep Guardiola at Manchester City.
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