Liverpool have reportedly been dealt a blow in their quest to sign AC Milan attacker Christian Pulisic.
The Merseyside outfit experienced an underwhelming transfer window in the summer, signing Federico Chiesa on a cut-price deal and agreeing a transfer with Valencia to recruit goalkeeper Giorgi Mamardashvili ahead of next season.
Their lack of transfer activity has not affected their performances on the pitch, with Liverpool currently sitting top of both the Premier League and Champions League standings.
While they are achieving positive results in Arne Slot's first season, Liverpool are on the lookout for potential reinforcements in future transfer windows.
The Reds are believed to be keeping tabs on Pulisic's progress after identifying the USA international as a possible transfer target.
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Liverpool suffer Pulisic setback
Pulisic, who has also been linked with Manchester United, has been in fine form for Milan this season, netting eight goals and providing six assists in 20 competitive appearances.
As a result of his impressive displays, Liverpool are seemingly keen to bring him back to the Premier League after leaving in the summer of 2023.
However, according to Calciomercato, Milan are working hard on a contract proposal to extend Pulisic's stay with the club.
Pulsic's current deal runs until the end of the 2026-27 season, with Milan holding the option to extend by an additional 12 months.
Rather than triggering the extension, the Rossoneri are keen to offer Pulisic a new deal on improved terms to reflect his performances for the club.
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Will Pulisic sign new Milan deal?
The Milan hierarchy are preparing a contract offer which will give him the chance to increase his salary from €4m (£3.3m) to €5m (£4.2m) net per season.
Pulisic is set to give the green light to the new deal, with the American said to be 'totally immersed' with his life at the Serie A giants.
There is a belief that the Rossoneri have stepped up their efforts to tie down Pulisic to a fresh deal to ward off interest from Liverpool.
The new contract would protect Pulisic's transfer value, leaving Milan in a strong position should Premier League clubs come calling in the near future.