Manchester City chairman Khaldoon Al Mubarak is due to fly into Manchester this morning to oversee two major transfers.
He intends to sign Milner first in a deal worth £26m, with Villa receiving £18m in cash and City midfielder Stephen Ireland, who is valued at £8m. Villa had demanded £30m but believe Ireland could prove a bargain.
City and Inter are haggling over a fee for Balotelli, and manager Roberto Mancini said yesterday: "Milner is like Balotelli. We are close. We are speaking. Probably Milner is closer than Balotelli.
"We want to buy Balotelli at the right price. We are close, but we have time. When we want to buy a player the price is not normal, but we want to improve quickly and to do this we must often buy players that will cost more than normal."