The winger remains Ole Gunnar Solskjaer’s top target this summer but the club will walk away from a deal if they can’t reach a realistic agreement over price.
It is understood the German side want €120 million (£108m/$142m) for the former Manchester City man but United are not willing to go near that fee with the effects of the coronavirus pandemic hitting the club.
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Reports had widely suggested Sancho had already agreed personal terms with United but it is understood discussions are continuing and no terms have been agreed.
The club is still paying for the mistake they made when signing Alexis Sanchez and the impact his high salary had on the wage structure at the club. Consequently, any deal agreed with 20-year-old Sancho over wages would be with that in mind.
Solskjaer said in his press conference on Tuesday that the club would not be rushing transfers this summer. “This transfer window is a long one, every transfer takes its course. It is what it is,” the Norwegian said.
Dortmund have set their own deadline of August 10 in order to have their squad ready to start preparing for the new season but it is understood United will not be bound by the demands of the German side and if discussions – which are understood to be at an early stage – go beyond that date and the Bundesliga outfit won’t sell beyond that, then United will move on to other targets.
Bayern Munich winger Kingsley Coman is another player who Solskjaer is interested in and United could move their focus to either Coman or another alternative if they cannot come to an agreement with Dortmund.
Executive vice-chairman Ed Woodward has warned for a while that it would not be business as usual during the current transfer window and while United are in a better position than many other clubs, it is understood they are still feeling the impact of the pandemic.