Transfer Talk: James back to Real Madrid; 'SMS' set for lucrative Lazio extension?

The English transfer window is closed, but the rest of Europe (except Italy) is still open for business, and Transfer Talk has the latest rumours making the rounds. Follow along with our daily blog throughout the summer.

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Real seek expensive James return

Real Madrid are seeking to cut short James Rodriguez's two-year loan to Bayern Munich, but it will come at a premium of £35m in compensation.

Los Blancos want the Colombian back, though the Bundesliga champions are able to make the deal permanent at any time for £37.7m, report El Pais, but Real could opt to cut the loan short by a year for a hit of £35m.

The Colombian appears determined to remain in Bavaria, stating: "I think my future is here. There are a lot of rumours, they talk about a lot of clubs, but right now I'm thinking about Bayern Munich.

"When I look back at my first year at Bayern I am very happy. This year I want to win more trophies and also be a big help to the team.

"We have a team that works well together and so everything is possible. I want to win the Champions League with Bayern Munich whatever it takes."

Milinkovic-Savic nears extension with new release clause

Sergej Milinkovic-Savic has been targeted by Real Madrid, Juventus and AC Milan this summer but Lazio appear close to extending terms with the Serbia international.

The Rome-based club's president Claudio Lotito has demanded at least €150m (£136m) for his side's prized jewel, with no club willing to pay that premium.

But if the 23-year-old pens an extension, worth €3.2m (£2.9m) per year until 2023, Corriere Dello Sport believe a release clause will be inserted, which could suit all parties.

Milinkovic-Savic scored 14 goals and assisted nine more in all competitions to push the Biancocelesti to the brink of Champions League qualification, and should he stay, manager Simone Inzaghi will be confident of making a run at a top-four finish once again.

Everton set to make big profit on Lookman

Everton are set to sell Ademola Lookman to RB Leipzig for £25 million -- securing the 20-year-old on a permanent basis after a successful loan spell in the Bundesliga last term.

The Mirror claim Leipzig failed with two previous bids and after a third bid of £22m, the Toffees countered with a compromise of £28m plus add-ons. But after Lookman was omitted from the squad to face Bournemouth, progress appears to have been made, with the Merseysiders set to pocket a huge profit just over 18 months after signing the winger from Charlton for an initial £7.5m.

The breakthrough in negotiations comes just after Marco Silva proclaimed the English talent as the "present and future" at Goodison Park.

"He is our player. You know what my technical opinion of the player is and the player knows. For me it is not an issue," Silva said.

"I understand some clubs are interested in him but at the end I told you last week, I told you two weeks ago, [in] my opinion he is the present and the future of the club and we have to try to convince him to go in this way as well."

Barca prepare to ship out Rafinha

Barcelona are set to move Rafinha on after Ernesto Valverde omitted the midfielder from his squad to face Real Valladolid this weekend.

And Sport believe that the Brazilian could quickly move on to Real Betis.

The 25-year-old spent the second half of last term on loan with Inter, making 17 appearances and contributing two goals and three assists for the Nerazzurri -- who opted against a permanent deal in favour of signing Radja Nainggolan.

Ernesto Valverde has reiterated he wants Rafinha to stay but the lure of consistent playing time somewhere else in La Liga could be too much for the midfielder to pass up.

A previous Sport report suggests Barca will pocket €1.5m for relinquishing their player temporarily, whilst Betis will cover his wages and send another €500,000 to the Camp Nou if they make the top four.


Chelsea, West Ham eye young Dagenham goalkeeper

Seventeen-year-old Tarek Najia is seen as one of the finest prospects at the club, despite not making his official first-team debut yet, with big clubs now tracking his progress, claim Just Football.

Did Muto turn down Chelsea?

New Newcastle signing Yoshinori Muto has revealed he knocked back Chelsea tw years ago, claim the Telegraph.

The Japan international is quoted as saying in the Telegraph that it felt as if the Blues didn't really want him and that regular football at Mainz was more important.

"I was 22 when I got the offer from Chelsea," said Muto. "At the time, I didn't feel the manager of the club really wanted or needed me.

"I think they wanted to sign the young potential of players and then loan them out to help them progress. Instead of doing that, I wanted to stay at a club to help me progress."

'Wessi' to League One

Rumours emerged on Friday that 36-year-old Wes Hoolahan could be close to joining League One side Fleetwood Town.

The retired Republic of Ireland international has been without a club since leaving Norwich at the end of last season but according to Sky, could be a nearing a surprising move to League One.

Hoolahan is best known for his pinpoint, long-range deliveries and if signed would be managed by Joey Barton, who took over as manager at Fleetwood before the season.