Manchester City will submit its first official offer to Rayan Cherki next week as they begin reshaping the midfield for the new season.
The 21-year-old is a priority for Pep Guardiola, and City hopes to land in time on the organizer of Lyon, the upcoming FIFA Club World Cup.
Cherki has not agreed to the personal terms, but City has established direct contact with his representatives in advance and collected background information from former coaches, including Lyon boss Pierre Sage.
City's interest is also consistent with Liverpool, Aston Villa, Dortmund and Bayer Leverkusen in the growing competition.
According to L'Equipe, the Premier League champion is expected to test Lyon's determination by initial bids exceeding the value of the €22.5 million set last year.
Cherki is in compliance with the contract until 2026, but Lyon opens sales, and he reportedly values about €40 million.
The midfielder, who contributed eight goals and 11 assists in all games last season, is seen as an ideal choice for Guardiola's ever-evolving team.
He has the ability to play the 10th or wider offensive role, and his technical quality and versatility make him one of the outstanding talents in Ligue 1.
Sources close to players insist that the final decision will not be made until the French under 21 end the training camp.
Guardiola hasn't spoken directly with Cherkey, but internal discussions in New York City suggest that formal approaches are about to come.
Cherki's moves with AC Milan's senior talks on Dutch midfielder Tijjani Reijnders.
Reijnders have reached personal terms with the champion, although negotiations are underway for Milan's £76 million valuation.
Manchester City hopes to end the Reijnders deal in the next few days, both clubs are keen to resolve quickly.
Premier League holders hope to refresh their midfield options after a tough season and are skeptical of the long-term future of several squad players.
With Cherki and Reijnders radars, City has expressed their intentions early in the transfer window as they prepare to challenge Liverpool's domestic dominance next season.