Liverpool have offered Mario Balotelli to Inter Milan during negotiations for Mateo Kovacic.
Sportmediaset says the two clubs remain locked in talks over the Croatia international's proposed move to Anfield.
Inter refuse to budge from their €25 million cash valuation for Kovacic.
Liverpool have attempted to drive down the price by offering Balotelli in part-exchange - but the response was a definitive, "No".
Balotelli played for Inter coach Roberto Mancini at Manchester City and also in his previous spell with the Nerazzurri.