City is set to test Liverpool's resolve with an improved package for the England international and remains interested in Hoffenheim's Brazilian star Roberto Firmino.
Manchester City is set to make a new offer worth 40 million pounds for Liverpool forward Raheem Sterling.
Goal understands thatLiverpool rejected an initial offer of £25 million plus £5 million in add-ons off hand from City last week.
But City is set to return with an improved bid of £35 million plus performance-related add ons, which could total in excess of £5 million.
City is reluctant to spend in excess of £40 million to sign Sterling, who looks certain to leave Liverpool after his agent, Aidy Ward, declared he would not be signing a new contract at Anfield.