Report: Milan refuses to pay loan fee for Everton's Deulofeu

Gerard Deulofeu's loan move to AC Milan is in danger of collapsing after AC Milan reportedly refused to pay a loan fee for the Everton midfielder.

After Milan CEO Adriano Galliani confirmed his the Italian side was in talks over a loan move for Deulofeu, reports emerged later in the day that Everton dismissed Milan's initial offer.

According to Sky Sports, a move for the former Barcelona player could fall through after Milan refused to pay Everton a loan fee. The two sides, however, remain in talks as they attempt to find a solution.

Everton manager Ronald Koeman is believed to have give the green light for Deulofeu to leave after using the 22-year-old primarily as a substitute this season.

Barcelona has a buy-back option in its agreement with the Merseyside club, but will not block a potential move to Milan.

A year after playing somewhat of a prominent role - appearing in 26 league matches with two goals and eight assists - Deulofeu has only managed to make 13 appearances in all competitions this season.