Locatelli, 23, has emerged as one of Italy's most promising midfielders in recent seasons.
A product of Milan's academy, the Lecco native spent three seasons in the first-team before joining Sassuolo on loan in 2018.
That move became permanent last season and Locatelli has continued to grow his reputation with the overachieving Neroverdi.
Playing on the left side of Roberto De Zerbi's three-man midfield, Locatelli has impressed scouts with his precise and expansive passing ability.
And if Locatelli can adjust to playing at a bigger club, Donati has absolutely no doubts about his potential.
"Locatelli is a player who knows how to do everything," the former Italy U21 international told TribalFootball.com.
"He is the all-round classic player. He knows how to play the ball well, has a good body, defends well enough and is good in scoring goals.
"The only problem is that playing for Sassuolo is different than playing for Milan or for City. So if he holds up the pressure on a mental level he can play anywhere. However, he is a good player."
Borussia Dortmund have also been linked with Locatelli, who has been labelled as the best midfielder in Italy by his manager.
Speaking in November last year, De Zerbi told La Repubblica via Goal: "Locatelli's growth has been exponential, he is ready to play at the highest level and take the Nazionale by the hand.
"I saw him play against Holland and he dominated Wijnaldum, someone who won the Champions League and Premier League with Liverpool.
"At this moment, he is the best midfielder in Italy and still has ample margin for improvement."