The 19-year old has been linked with the Eastlands club for some time now but it seemed a deal would not be done when Inter president Massimo Moratti played down any transfer murmurings.
But now, City have claimed they have struck a £23million agreement with the Nerazzurri to reunite Balotelli with former boss Roberto Mancini.
Ex-Liverpool boss Rafael Benitez, who has taken the reins from Jose Mourinho at the San Siro, revealed that he was resigned to losing Balotelli this summer.
“The club decide the transfers, I adapt,” said Benitez. “Do I fear being remembered in a few years as the coach who let Balotelli go?
“I repeat: I do not control the market. One player doesn’t make a team and Inter have many strong players.”