The report claims that Milan have just penned new improved deals for three stars, further weakening their ability to make moves this summer and hindering the prospect of Balotelli joining permanently.
No contact is said to have been made between the Serie A giants and Liverpool, and it is now looking increasingly likely that the striker will move back to Anfield as he is not deemed a priority for Milan.
Balotelli joined Liverpool in the summer of 2014, weeks after Luis Suarez left the Reds for Barcelona.
While not signed as a direct replacement, comparisons were evidently made and the Italian striker came up well short in expectations as he struggled to make an impact on Merseyside.
After going months without finding a league goal for Liverpool, Balotelli soon found himself on the periphery of the Liverpool first-team squad and was tipped to leave the club the following summer.
He re-joined Milan on a loan deal with a view to a permanent signing last summer, yet his struggles have continued at the San Siro and it appears the Italian club will not be taking up the option to sign him.
Balotelli’s future is uncertain and it will come as a great surprise if Liverpool boss Jurgen Klopp keeps him on.