Report: Man City's Cancelo set for surprise loan move to Bayern Munich

Bayern Munich are set to sign Joao Cancelo on loan from Manchester City ahead of Tuesday's transfer deadline, reports David Ornstein of The Athletic.

The deal will likely include an option for the German club to make the move permanent in the summer, Ornstein adds. That purchase option could be worth €70 million, sources told Rob Dawson of ESPN.

Cancelo, once an undisputed starter and crucial contributor for Manchester City, has fallen out of favor with Pep Guardiola of late. The Portuguese full-back, 28, hasn't started any of City's last three matches in all competitions due to an apparent fracture in his relationship with the manager. After featuring consistently to begin the season, he's started only five of City's last 14 games in all competitions.

The versatile Portugal international was named in the PFA Premier League Team of the Year in each of the past two seasons, establishing himself as one of the game's most creative players at the full-back position. His attacking input was vital in helping Manchester City claim the Premier League title last season; Cancelo started 36 games and crafted seven assists en route to helping City capture another league crown in 2021-22.

But his playing time has been reduced recently, thanks in part to the emergence of 18-year-old academy graduate Rico Lewis. Nathan Ake has also been picked ahead of Cancelo to occupy Guardiola's left-back position.

Bayern have long been admirers of Cancelo, reports Ornstein.

The Bavarian club is looking for a spark amid a dip in form. Bayern have drawn all three of their matches - each by the same 1-1 scoreline - since returning to action after the World Cup break. As a result, their lead atop the Bundesliga table has dwindled to just one point over Union Berlin.