As per The Sun, City could offer the 19-year-old to the Seagulls as a sweetener in a potential deal for Spanish full-back Marc Cucurella.
Cucurella is reportedly one of City’s top transfer targets this summer, however, given that he is set to command a fee in the region of £40 million pounds, Man City are looking at ways to bring that fee down.
Given that McAtee has attracted previous transfer interest from Brighton, a potential loan move for the youngster to the AMEX Stadium is seen as one way of potentially doing so.
This news comes as a blow to Swansea City and Huddersfield Town, who have both been linked with a summer loan move for McAtee.
Russell Martin is looking to add to his side’s attacking presence, and it was hoped that their free-flowing style would give them a chance to sign the 19-year-old temporarily.
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Meanwhile, with Danel Sinani set to return to Norwich City following his loan spell, Huddersfield will be looking for a creative presence to add to their midfield this summer.
McAtee scored 23 goals and registered eight assists for Manchester City’s under 23’s throughout the 2021/22 campaign.
This undoubtedly comes as a blow for both Swansea and Huddersfield, however, they should not give up hope yet.
In the initial report that linked the two clubs with a move for the 19-year-old, Alan Nixon stated that Forest had a better chance at securing his signature if they did not get promoted to the Premier League.
That suggests that Man City feel a move to a Premier League club may be a bit soon for the youngster, and would prefer him to head down to the Championship.
You only have to look at Phil Foden for an example of how steadily City like to bring their youngsters through, so there may be hope for the Swans and Terriers just yet.